The Power of a Low-Cost Portfolio
Watch Out for Hidden Costs
All investment strategies come with costs, and these can often be overlooked by those new to the field. Trading commissions, management fees, expense ratios for mutual funds or exchange-traded funds (ETFs), and even tax liabilities can quickly erode your investment returns if not kept in check.
Consider this: if you were to invest $10,000 annually into a fund with a 7% return but had a 2% annual fee, over 30 years you'd end up with nearly $800,000. However, if the same investment had only a 0.2% annual fee, you'd end up with over $950,000. That's a staggering $150,000 difference. Seemingly insignificant percentages can mean tens or hundreds of thousands of dollars lost to fees over the long term.
Build Wealth Faster with a Low-Cost Portfolio
Define Your Investment Goals
Take Advantage of Index Funds and ETFs
The Long-Term Impact
The beauty of a low-cost portfolio strategy is in its simplicity and long-term effect. The focus on minimizing costs doesn't require you to predict the market's direction or time your trades perfectly. Instead, you allow the power of compound interest to work its magic over time. Every dollar saved on costs is a dollar that can be reinvested, giving it the potential to grow exponentially.
A low-cost portfolio isn't just about being frugal. It's about maximizing your potential wealth by letting more of your money work for you. By trimming the costs associated with your investments, you are effectively boosting your returns and building your wealth faster.
The aim of a low-cost portfolio is to maximize your net returns over the long term. While it's important to minimize costs, it's also crucial to make informed investment decisions based on thorough research. Always remember that all investing involves risk, and it's important to invest in a way that aligns with your personal risk tolerance and financial goals. Reach out to Chicago Partners to set up an introductory meeting and complimentary portfolio audit with one of our advisors.
Remember, investing is a long-term game, and the most successful players are those who understand that every penny counts. The less you pay, the more you keep, and the faster you can build your wealth. So, next time you consider an investment, pay close attention to the costs. You might be surprised at just how much faster your wealth can grow with a low-cost portfolio.
Important Disclosure Information
Past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Chicago Partners Investment Group LLC (“CP”), or any non-investment related content, made reference to directly or indirectly in this commentary will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this commentary serves as the receipt of, or as a substitute for, personalized investment advice from CP. Please remember to contact CP, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. CP is neither a law firm nor a certified public accounting firm and no portion of the commentary content should be construed as legal or accounting advice. A copy of the CP’s current written disclosure Brochure discussing our advisory services and fees continues to remain available upon request.