thoughts on Fidelity Freedom fund

[jIM_Ohio]

There may be no load fees, but there are still expense fees incurred by all funds which include management and 12b-1 fees. The amount of which is shown in the expense ratio of the fund.

Know what you are talking about, please... this is factually incorrect at T Rowe Price.

NO 12b-1 fees
NO Loads
No wrapper on fund of funds (this is same for Spectrum funds, Target retirement funds and other fund of funds offered by T Rowe).

Not all mutual fund companies charge high expenses.

[kv968]

Know what you are talking about, please... this is factually incorrect at T Rowe Price.

Sorry about "not knowing" what I'm talking about. How much are the expense ratios on your T Rowe funds, 0%? I know mine are about .75%. I know there aren't any load or 12b-1 fees but there are operating expenses and management fees hense the expense ratio. It may not actually be considered a "fee" (sorry if I used that term wrongly), but it is an expense and that's what I was trying to point out.

And I didn't say ALL mutual fund companies charge high expenses. There are some that do but most are really keeping them down. I own funds with T Rowe myself and I think they're great.

[Scanner]

T. Rowe Price

It does appear I was right - there is an expense fee of .76% associated with this Retirement 2050 Fund.

So, now, there's the normal mutual fund fees and pile on that another .76%.

I guess it's nice to have one place to send your money but I don't know, that .75% could add up IMO. I don't think you need to hold a lot of mutual funds to be diversified and have to rebalance that often (once/year maybe).

I don't know. . .like I said. . .I do use a mutual fund of mutual funds for our college 529 because that time seems to fly but retirement. . .anyone should be able to rebalance 1x/year.

[jIM_Ohio]

T. Rowe Price

It does appear I was right - there is an expense fee of .76% associated with this Retirement 2050 Fund.

So, now, there's the normal mutual fund fees and pile on that another .76%.

I guess it's nice to have one place to send your money but I don't know, that .75% could add up IMO. I don't think you need to hold a lot of mutual funds to be diversified and have to rebalance that often (once/year maybe).

I don't know. . .like I said. . .I do use a mutual fund of mutual funds for our college 529 because that time seems to fly but retirement. . .anyone should be able to rebalance 1x/year.

I believe the .76% is the average expenses based on fund holdings, not a wrapeer of each fund.

But in looking at link provided, no way to know for sure.

My experience with T Rowe Spectrum funds is the expense ratio of "fund of funds" is a weighted average of the underlying funds and not a wrapper.

page 20 of prospectus suggests this



But it is still not as clear, I will give you that.

pg 39 suggests there might be a .25% retirement fund fee, which is not the .76% mentioned above.

[kv968]

I believe the .76% is the average expenses based on fund holdings, not a wrapeer of each fund.

That's basically what it is...an average expense of the underlying funds. The underlying funds presumably save money with a "fund of funds" since instead of having all individual accounts holding those funds (incurring more cost), they're all bought instead under the "fund of funds". Does that make sense? In other words, the expenses are basically offset and there are no extra fees associated with the "fund of funds". At least that's the way it is with T Rowe.

[sweeps]

Again, for the 3 major companies -- Vanguard, Fidelity, T.Rowe Price -- you are not charged expenses on top of the weighted average expense ratio of the underlying funds.

Prove me wrong and you get a free toaster.

[kv968]

Again, for the 3 major companies -- Vanguard, Fidelity, T.Rowe Price -- you are not charged expenses on top of the weighted average expense ratio of the underlying funds.

Prove me wrong and you get a free toaster.

Well I won't be winning a toaster because you're right, you're not charged extra expenses with these funds. I hope I didn't come off as if I was implying that.

[Scanner]

Jim,

But it is still not as clear, I will give you that.

pg 39 suggests there might be a .25% retirement fund fee, which is not the .76% mentioned above.

That's the problem with all mutual funds - very complex in their fee structures and wording of prospectii.