Service Fee

Service Fee The service fee is in place to give adequate financial compensation to any financial planners or brokers that are used over the course of an investment. This is part of the 12b-1 fee that is present in most mutual funds, but it cannot be any higher than 0.25% of the fund's value. This is a shareholder's service, so it is agreed upon by all investors before anything is implemented. In some cases, the service fees might be waived, however, as is the case with some retirement funds. In those cases, however, a yearly fee will be taken instead of an end service fee.