Chapter 14. Be Aware of the Important Issues

Part 2 identified a number of potential problems that can occur for owners of mutual funds. However, we also noted that some of these problems can be overcome . At the very least, if investors are aware of the potential problems, they are in a much better position to deal effectively with them. Let's concern ourselves now with the more important issues about mutual funds that a number of observers have identified and consider their impact on the wealth-building process.

These are issues that most mutual fund shareholders, or potential shareholders, confront, and they do not easily go away or get dealt with. Shareholders have very little control over taxable distributions, for example, nor they can do anything about excessive costs except sell their shares and leave the fund. The best approach for shareholders is to be well informed about these issues, consider them carefully , and evaluate the alternatives to owning mutual funds to see if these issues can be better resolved by investing in these alternatives.