Dale Jackson

Personal Finance Columnist, Payback Time

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Turn down the lights and gather ‘round.

This is the story of hard-working Canadians who pay blood-sucking fees to put their retirement savings in zombie mutual funds.

As of Oct. 1, the past year hasn’t been so bad in the land of the living. In the U.S. the S&P 500 Total Return Index has risen more than 13 per cent in Canadian dollars, but the average U.S. equity mutual fund has gained less than 10 per cent over the same period.

In Canada, the TSX Total Return index has advanced more than 14 per cent while the average Canadian equity fund has only gained 11 per cent.

For many below-average funds, gains were devoured by high fees.    

There is a lesson for the living. Make sure you do your homework before investing. Look at the manager’s track record and be sure to ask about all fees – management expense ratio (MER), loads (front and back) and commissions.    

In the meantime, watch the video for a look at some of the scariest mutual funds over the past year – if you dare.

Dale Jackson is BNN's Personal Investor. Follow him on Twitter @DaleJacksonPI