An Expensive InvestmentSeptember 22, 2003
Back in 1998 I was tempted (lured) by an investment form that promised a tax free return. By paying a small percentage each year, when I later chose to cash in it would be tax free.
There was a choice of switching between funds and it seemed reasonable to get an average annual return of 10%.
Then the problems started. Being 1998 I invested mostly in tech funds. Fast-forward to 2003 and only 30% of my investment remains.
When I called my fund manager to see what the status was I was explained that not only had the fund decreased in value due to bad world economy (fair enough) but that there is also a minimum fee that I am paying each year to the fund manager. This irrespectively of whether the fund has positive or negative track record (not fair enough).
Even worse, because my humble investment had decreased a lot in value, the minimum annual fee was around 10% of my investment and increasing. When I questioned whether this was reasonable, that the fund needed an annual return of 10% in order for me not to loose any money, I was told a confident yes.
I disagree and will be taking out any pennies left and rather spend them on lollipops and bubble gums.
On the other hand, Kina is an upcoming investment possibility.
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