Just found out my investment app charges a 0.5% fee on top of the fund fees I thought were the only cost

I was scrolling through the fine print in the Babble Finance subreddit last night, and someone posted a screenshot from their brokerage statement. I always thought the expense ratio was the only thing eating my returns, turns out my app has been quietly taking half a percent every year on top of that. I checked my own account this morning, and there it was, buried in the Terms of Service under 'operational fees'. That's around $50 a month on my portfolio I've been paying for 2 years without knowing. Has anyone else spotted hidden fees like this in their platform?

3 comments

3 Comments

shanelee3d ago

Yeah I mean $50 a month stings I get it but is it really that crazy? 0.5% is pretty standard for a lot of apps that handle the buying and rebalancing for you. If you were doing it all yourself on Vanguard you'd pay zero fees but you'd also be the one clicking buttons and messing up your asset allocation every quarter. People freak out over 0.5% but then pay 1.5% expense ratios on actively managed funds without blinking. Just check if that fee covers stuff like auto rebalancing and tax loss harvesting, cause if it does it might actually be worth it.

the_xena3d ago

Wait @shanelee actually thinks 0.5% is standard? I just checked my app and it's been 2 years of bleeding $50 a month without me even noticing. That's like $1200 gone just for clicking a few buttons for me.

brian_smith63d ago

Man I just did the same math on my account and felt like I'd been pickpocketed by a very polite robot for two years straight. $50/month really adds up when you're not paying attention.