Business, Legal & Accounting Glossary
In the financial sense, a maintenance fee is a fixed charge that covers the operating expenses of a brokerage account. Usually, the maintenance fee is charged annually. Some brokers, especially full-service brokers, may impose the maintenance fee as an alternative to charging a per-trade fee on each transaction. Sometimes, a fund may have a maintenance fee if its value is less than a certain dollar amount or if the fund becomes inactive. An asset management account, which combines banking services with brokerage features, and IRAs are examples of funds that typically have a maintenance fee. A maintenance fee may also be deducted from a mutual fund to cover operating expenses. Additionally, owners of annuities sometimes pay a maintenance fee to cover the administration of the contract, including various customer services, statement preparations, mailings and premium notices.
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This glossary post was last updated: 7th February, 2020 | 0 Views.