There are costs to investing your money, whether you do it through an adviser, or on your own through the Internet. You will pay taxes on what you make, for example. Some other common costs include fees that investment companies charge to:
- Maintain your account and prepare account statements
- Close an account
- Move your money between accounts
- Buy or sell an investment for you
- Manage a mutual fund
- Give you advice.
Sometimes the person who sells you an investment gets a percentage of the sale. This fee is called a commission. Sometimes, you don’t see this fee because the company takes it out of the money that you make investing, before you ever see it. For example, when you buy a Guaranteed Investment Certificate (GIC), you don’t see a separate fee; the bank just offers you a lower interest rate to cover its costs.
Remember: All investments have costs. Make sure you’re getting good value
Don’t buy an investment unless you understand all of the fees you are paying. If you are concerned about high costs, look at what you made to see if the fees are worth it.
Content in this section is provided in partnership with the Investor Education Fund, a non-profit organization promoting financial literacy to Canadians. To find out more go to GetSmarterAboutMoney.ca.