Everything costs money whether you like it or not. As they say, “there’s no free lunch”. Even that ‘free’ toothbrush you got at the dentist cost someone money. When it comes to investing, even though you are making money, it is not free. You pay commissions when you buy stocks and you have to put in the time to research and purchase it. It costs your time and some money.

One type of investment is a mutual fund. With a mutual fund everyone who invests in it put their money together which the fund manager uses to buy the stocks they choose. With load funds you have to pay a commission, but with no-load funds, you pay no commission. This is the closest you’ll get to free investment money because you pay no commission and you don’t have to research the stock choices.

There are many obvious and not so obvious advantages to no-load funds. When you don’t pay a commission, you save money. Also, the money you save is purchasing you more investment which also earns you more money.

Invest your money and you put your money to work. When you save on commission, you have more money working and earning for you.

As I mentioned, another way that investments cost you is through time and effort. If you are buying stocks and bonds, you have to research the company you are buying shares of stock from. If you just invest in a company that you blindly pick from the newspaper, you are greatly increasing the risk of your investment.

Just researching is not enough. You have to know how to research first. This will take a certain amount of time in education, whether through books or a college degree. It can take from 100 hours of reading and studying to 1000 hours of formal education. This is valuable time that could be spending at countless of other places.

Mutual funds save a lot of time. You don’t have to research, aside from choosing the initial fund, and you don’t have to know how to research. With a mutual fund, the fund manager, who is likely an expert, does all this for you. You save hours and hours of your time. You make the initial choice of a mutual fund and let the manager do the rest.

If you want to spend a lot of money on fees and commission for loaded funds, you can, but it’s likely they won’t earn that much more money and they might even earn you less after the fees. If you are interested in having a well diversified portfolio that is very easy and cheap, get a mutual fund.