Mutual Fund Fee Offsets for Edward Jones Trust Company Accounts
A Mutual Fund will charge management fees as compensation for its services and its assumption of certain expenses. Certain mutual funds will often also charge a distribution and marketing fee out of its assets that is used to pay broker-dealers, like Edward Jones, for sales of the funds and marketing costs (this fee is commonly referred to as a “Rule 12b-1 fee”).
Edward Jones Trust Company is committed to providing our clients with quality investments while seeking to minimize related costs to our accounts. When purchasing mutual funds, we will select the most appropriate share class within each fund. In certain cases, this is an institutional or advisory class that does not charge a 12b-1 distribution and marketing fee. We also have been working to transition many individual mutual funds to these share classes.
In some cases, an account will continue to hold a share class that pays Edward Jones Trust Company 12b-1 fees. If an account holds a position in a mutual fund that pays Edward Jones Trust Company 12b-1 fees, Edward Jones Trust Company will credit the account by a "Fee Offset" amount approximately equivalent to the fund's proportional share of 12b-1 fees received by Edward Jones Trust Company.
Considerations to maintain these shares include:
- An institutional/advisory share class is not available,
- Edward Jones Trust Company is not eligible to purchase the institutional/advisory share class, or
- It would be more cost-effective for the portfolio to receive a Fee Offset instead of exchanging into an institutional/advisory share class.
Fee Offsets will be reflected monthly on your statement as transactions described as "12b-1 Fee Offset." An account may not eligible for a Fee Offset in the month that the account closes.
If your account's portfolio holds mutual funds only in share classes that do not pay Edward Jones Trust Company a 12b-1 fee or if your account includes only the custody of assets, you will see no Fee Offsets reflected on your statement.
If you have further questions about the Mutual Fund Fee Offsets in regards to your Edward Jones Trust Company account, please contact your Edward Jones financial advisor or dedicated Trust Company portfolio manager at (888) 566-3747.
