Small account balance fees?

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stannius
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Small account balance fees?

Postby stannius » Tue Sep 11, 2012 10:44 am

My daughter has a Coverdell ESA with $640 in it. The account is at Sharebuilder and the positions are
AGG ISHARES BARCLAYS AGG BOND FUND $18.03
EFA ISHARES TR INDEX MSCI EAFE IDX $81.36
SPY S&P 500 INDEX SPDR $539.11

My question is, do any of those investments, all ETFs AFAIK, have an absolute (non percentage based) fee? Or a fee for low balances? (I believe some Vanguard funds, for instance, have fees below a certain balance.)

It would cost us $9.95 to sell each of the smaller positions. But if it's that or the money just getting eaten away in a year or two by fees, well, I guess paying 50% in fees is better than nothing.

brad
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Re: Small account balance fees?

Postby brad » Tue Sep 11, 2012 11:58 am

With ETFs, you can buy just one share if you like, there's no minimum investment unless for some reason the brokerage has imposed one. You should check at http://www.savingforcollege.com/coverde ... providers/. But the ETFs by themselves do not carry a fixed fee.

I looked up these ETFs (you can do a simple Google search to find them) and it appears that their only expenses are the management expense ratio, which is a percentage, not a flat fee. It just acts as a small drag on growth.

The place where you usually find minimum balance fees is mutual funds, not ETFs.

stannius
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Re: Small account balance fees?

Postby stannius » Tue Sep 11, 2012 3:09 pm

Yes, I did search for them. I was just looking for reassurance I guess. I have already made mistakes with the account (for instance, the AGG position already has a 40% loss because ShareBuilder didn't work like I thought it would, and invested $8 minus a $4 investment fee every Tuesday for three weeks before I noticed.)

brad
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Re: Small account balance fees?

Postby brad » Tue Sep 11, 2012 3:15 pm

Okay, but be sure to check the link I provided above, because it shows any fees imposed by the broker.

stannius
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Re: Small account balance fees?

Postby stannius » Tue Sep 11, 2012 4:22 pm

brad wrote:Okay, but be sure to check the link I provided above, because it shows any fees imposed by the broker.


Sharebuilder is not on that list, but their page regarding ESA's claims they don't charge fees:
http://www.sharebuilder.com/sharebuilde ... e=CHELP009


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