# Management expense ratio (MER)

> The management expense ratio (MER) is the yearly cost of owning a Canadian mutual fund, shown as a percentage of the fund's value and taken out of the fund before its returns are reported.

Canonical page: https://find.wellspent.co/glossary/mer/
Also called: MER, fund fees, management expense ratio

The MER combines the fund's management fee and its operating expenses. For funds sold through an advisor, the management fee usually includes a trailing commission paid to the advisor's firm, so part of the MER is the cost of advice.

You never see an MER on a bill. It comes out of the fund every year, whatever the fund's performance, so it's easy to overlook. Trading costs are reported separately as the trading expense ratio.

With a fee-only or advice-only planner, advice is billed separately and you can choose low-cost funds with no trailing commission. Canadian fee-only planners who publish prices charge a median C$1,900 for a one-time plan or C$2,300 a year for ongoing planning, a dollar figure you can set against what an MER costs on your balance.

## How to check

Every Canadian mutual fund publishes a Fund Facts document, and every ETF an ETF Facts, showing the MER, the trading expense ratio and any trailing commission. Multiply the MER by your balance to see the yearly cost in dollars.

## Sources

- [Ontario Securities Commission, GetSmarterAboutMoney.ca: Mutual fund fees (updated September 26, 2023)](https://www.getsmarteraboutmoney.ca/learning-path/mutual-funds-segregated-funds/mutual-fund-fees/)
- [BC Securities Commission, InvestRight: Mutual fund fees explained (June 15, 2022)](https://www.investright.org/news-and-insights/investing-articles/mutual-fund-fees-explained-2/)
- [Autorité des marchés financiers, Mutual funds facts](https://lautorite.qc.ca/en/general-public/investments/funds/fund-facts/mutual-funds-facts)
- [Wellspent, What fee-only financial advisors charge (2026), Canadian figures](https://find.wellspent.co/reports/fee-only-advisor-fees/)

## Related terms

- [Trailer fee (trailing commission)](https://find.wellspent.co/glossary/trailer-fee.md)
- [Deferred sales charge (DSC)](https://find.wellspent.co/glossary/deferred-sales-charge.md)
- [Fee-only financial advisor](https://find.wellspent.co/glossary/fee-only.md)
- [Advice-only financial planning](https://find.wellspent.co/glossary/advice-only.md)