Whether it’s investing or owning a home, my clients frequently hear me discuss “total costs of ownership” and value received.

   Warren Buffett fans well know that price is what you pay, and value is what you get.  You can’t consider one without the other.

   Morningstar published an update into typical mutual fund costs paid by investors, and the news was generally good.  By “generally good” I mean that it did not suck as badly as it did a decade ago.

   You can read the report here, but there are two numbers worth knowing.

   The average mutual fund investor pays asset management fees of 0.71% annually.

   The average mutual fund charges annual fees of 1.25%.

   What’s the difference in those numbers and why should we care?

   The difference is that the first number is weighted by investment dollars.  The fact that it is much lower than the average fund indicates investors are voting with their feet and their wallets by moving money from more-expensive to less-expensive mutual funds.  This is generally a good development.

   We should care that billions of dollars remain invested in expensive funds that are unlikely to deliver better results to their shareholders.  That is pure waste.

   If you work with a real financial advisor you will pay real money, of that there should be no doubt.

   At least for your fee dollar you should expect reasonable guidance on cash flow, retirement, education funding, estate planning, diversification and building a portfolio that gives you the best shot at reaching the financial goals that matter.

   Not to mention receiving empathy, dispassionate professional judgment, and a sounding board to stand in between you and doing something breathtakingly stupid the next time markets decide to go nuts (up or down).

   You could pay for that, or you could pay an asset management firm somewhere to underperform the market.  You are not required to do both. Your call.