How investment fees work
What you pay, where to find it, and what Canada's new fee report will and won't show you.
- 1
You pay in two ways
A fee to your advisor or investment firm, which you can see. And costs inside your funds, which come out of your returns, so you never see a bill.
- 2
From 2026, both are shown in dollars
New Canadian rules (Total Cost Reporting, sometimes called CRM3) add the to your yearly fee report. The first one arrives in early 2027.
- 3
It still won't say if that's fair
The report won't turn your total into a percentage of your portfolio, or compare it with what others pay. The fee check does both.
Check my fees →
Where to find your number
Your yearly fee report comes once a year, separately from your regular statements. Here's a made-up example for an $8 million portfolio. The number for the fee check is part 3.
1What you paid us
| Account management fee | $80,000.00 |
|---|---|
| Trading commissions | $1,250.00 |
| Total charges paid to us | $81,250.00 |
2Your investment fund costs New
| Fund expenses | $72,000.00 |
|---|---|
| Direct investment fund charges | $0.00 |
| Total investment fund costs | $72,000.00 |
3Total cost of your investments New
| Charges paid to us + investment fund costs | $153,250.00 |
|---|
4Fund expense ratios New
| Canadian Equity Fund, Series F | 0.95% |
|---|---|
| Global Equity Fund, Series F | 1.05% |
| Canadian Bond Fund, Series F | 0.61% |
5Important notices
Some amounts are reasonable approximations. Structured products, prospectus-exempt funds and labour-sponsored funds you own may have embedded fees that aren't included in this report. Custody fees and interest paid to third parties may not be included.
- 1
Your firm's charges
What you pay your investment firm and advisor. Today's report already shows this part. Until the new report arrives, ask your advisor to add your fund costs to it.
- 2
Fund costs
New. What it costs to run and trade inside your mutual funds and ETFs, in dollars.
- 3
Total cost: the number you need
Your firm's charges plus your fund costs, in one dollar total. Enter this in the fee check. Go to the fee check →
- 4
Each fund's cost as a percentage
New. Useful for comparing funds that do the same job.
- 5
The notices
They tell you what isn't in the total, such as pooled funds and structured notes.
What the report leaves out
It covers the funds most Canadians own. Some investments that larger portfolios often use are left out.
Included in the new report
- Mutual funds
- Exchange-traded funds (ETFs)
- Segregated funds, the insurance version of mutual funds*
- Education savings plans (scholarship plans)
- Foreign funds sold in Canada
* Covered by matching guidance from insurance regulators, adopted province by province.
Not included
- Pooled and private funds sold without a prospectus
- Structured notes
- Labour-sponsored funds (a type of tax-credit fund)
Also not counted as costs: , and fees paid to outside firms that hold your investments for safekeeping.
The dates that matter
Your firm has been tracking your fund costs since January. The first report arrives early next year.
- Rules finalizedCanada's securities and insurance regulators publish Total Cost Reporting.
- Tracking startsFirms begin recording what your funds cost you, day by day.
- The year closesYour 2026 costs are final.
- Your fee report arrivesThe first one to show your fund costs in dollars.
Words on your fee report
Tap a word to see what it means.
Annual report on charges and other compensation
The fee report your investment firm sends once a year. It is separate from your regular account statements. Starting with 2026, it adds the costs inside your funds.
Fund expenses
What running and trading inside your funds cost you, in dollars, for the days you owned them.
Management expense ratio (MER)
What it costs to run a fund each year, as a percentage of the fund: the manager's fee, office costs, and the sales tax on them. It comes out of the fund, so you never see a bill.
Trading expense ratio (TER)
What a fund pays in commissions when it buys and sells investments, as a percentage of the fund.
Fund expense ratio (FER)
MER plus TER. The new report shows this percentage for each fund you own.
Direct investment fund charges
Fees charged to you directly when you buy, sell or switch funds, such as a fee for selling a fund soon after buying it.
Trailing commission
A yearly payment from a fund company to your investment firm for as long as you hold the fund. It is paid out of the fund's MER.
Prospectus-exempt fund
A pooled or private fund sold without a prospectus (the official document that describes a fund). Its costs are left out of the new report.
Currency conversion spread
The extra built into the exchange rate when your money is changed into another currency, such as US dollars. It isn't reported as a cost.
All-in rate
Everything you pay in a year, for advice and inside your funds, as one percentage of your portfolio. Your fee report won't show it. The fee check works it out.
Words with a dotted underline elsewhere on this page show their meaning when you tap them or point at them.
Want more detail?
Six questions for your next review
Take these to your advisor, before or after your fee report arrives. A good answer gives you exact dollars and percentages.
- What is my total yearly cost, as a percentage of my portfolio, including the costs inside my funds?
- Do I own any pooled funds, private funds or structured notes? What do they cost me each year?
- Will my corporate, holding-company or trust accounts get the annual fee report?
- How much extra do I pay when you change my money into US dollars or other currencies? Roughly how much was it last year?
- Which market index should my returns be compared with, and how have I done against it after all fees?
- Is there a cheaper version of my funds, or a lower fee rate, I qualify for at my portfolio size?