Direct vs. Regular: The 1% Difference That Costs a Fortune

In the mutual fund world, 'Regular' plans pay a commission to a broker. 'Direct' plans don't. The difference is usually around 1% per year.

The Compounding Cost

1% sounds small. But over 25 years, that 1% difference in the Expense Ratio can result in you having 20-30% less wealth due to the loss of compounding on that 1% every year.

Switching to Direct

Switching is a simple 'REDEEM' and 'REINVEST' process. While there might be short-term exit loads or exit taxes, the long-term benefit of direct plans is mathematically undeniable for the self-directed investor.