How Your RIA Could Save You Thousands Upon Thousands of Dollars

By Rick Kahler via

One of the low points of my career was the day I lost a client because another advisor “had found a way to put their clients into the lowest cost shares available only to large institutions.”

This experience was especially painful because, through my office, the client already was invested in those same low-cost shares. I just hadn’t made sure the client knew that. It was a significant mistake in communication.

Many investors don’t know that most mutual fund companies offer a special class of share available only to investors with sizable minimum investments (usually over $1 million per fund). These shares carry the lowest expense ratio (annual fees paid to the fund manager) of any other share class and usually waive any front-end or trailing sales charges. Because it’s generally large private and public intuitions that have the large sums to meet the minimum investment, these are called institutional shares.

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