With Funds, What You Don't Know Can Cost You

Everything Else

Then there are all the other ancillary fees to be on the lookout for, such as extra charges for low account balances. They can add up.

Say you love the low costs of Vanguard's index funds but are buying one through Charles Schwab's fund supermarket.

You'll pay a minimum transaction fee of $35 to buy some no-load funds like Vanguard's. That amount doesn't sound like a lot. But 35 bucks would be 1.2% of a $3,000 investment in the (VFINX Quote)Vanguard 500 Index fund.

And that figure is six times higher than that Vanguard fund's annual expense ratio.

You're essentially defeating the purpose of buying a cheap index fund by paying a brokerage fee to buy it. If you really want to cut your costs, head straight for Vanguard.

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