Author Topic: "No Load" 401k option  (Read 1710 times)

Reepekg

  • Bristles
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"No Load" 401k option
« on: July 19, 2013, 05:47:28 PM »
Came across this gem while perusing my new company's 401k plan:

Buy a FundsNetwork Load Fund and there is a $0 fee
Buy a No Load mutual fund and the "transaction fees" are $75 if done online or $75-187.50 if done by phone

No load? Stay classy, Fidelity.

GreenGuava

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Re: "No Load" 401k option
« Reply #1 on: July 19, 2013, 06:23:12 PM »
Does the $0 fee include the load for the "Load Fund"?

Reepekg

  • Bristles
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  • Age: 35
Re: "No Load" 401k option
« Reply #2 on: July 19, 2013, 11:35:54 PM »
Does the $0 fee include the load for the "Load Fund"?

You pay a $0 fee but 5.25-5.75% as a load
or
You pay a $75-187.50 transaction fee and 0% as a load

I picture minions at Fidelity cackling maniacally after figuring out how to charge the people who pay moderate attention to personal finance media and know "never waste your money buying funds with loads" more money.

bUU

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Re: "No Load" 401k option
« Reply #3 on: July 20, 2013, 03:05:32 AM »
There's nothing untoward going on here. "Load" refers to fees that a fund charges (to get in or get out). They have nothing to do with the fees brokerages charge for account maintenance (on a monthly basis for example), or transaction fees they charge for buying or selling. Fidelity (and Schwab, etc.) offer a vast array of funds with no transaction fee, and a vast array of those have no load. If you choose a fund that has a transaction fee, then you're making your own choice to do so - in my experience, there has always been a reasonably comparable fund available with no transaction fee, in my experience.