How to Spot a Loaded Mutual Fund

Make sure you are buying a no-load fund.

Now that you know that buying loaded funds is bad, I'm here to help you determine if a fund carries a load or not.

Classy Funds Mutual funds that have a class - have no class. Stay away from mutual funds that have "Class A", "Class B" or "Class C" in their title. There are other classes you should look out for as well, but these are the most common. As mentioned before, loaded mutual funds try to charge you in a variety of ways (front-end, back end and constant loads)
Always Research the Fund

Find a good quoting service like Morningstar or Yahoo Finance and type in the fund's ticker symbol. Pay close attention to the sections that talk about the fund expenses.
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Look for anything referring to a load and make sure it says zero or none. Common areas to look for are:
Actual Fees

12b-1 Fees

Deferred Load

Front End Load

Front End Sales Charge

Deferred Sales Charge

You can ignore expense ratios and management fees for now - those are a separate more
complicated topic (all mutual funds carry some sort of of management fee to run the funds). If any of the above fees or charges say anything other than "none" or "0", then you are most likely dealing with a loaded mutual fund. Most quoting services will allow you to screen out funds that charge a load. If you discover you own a loaded mutual fund, you may want to find a no load alternative using this tool: Explode Loads.

Signs That You are Being Sold a Loaded Fund

Salespeople are very good at steering people in the wrong direction for their own benefit. If you see any of these arguments, you can be sure that they are lying and trying to sell you a loaded mutual fund:

"Loaded funds make up for their fees by outperforming no-load mutual funds." This is simply not true.
"Loaded fund companies provide better customer service." Wrong again.

"You can't buy these funds without going through us." Translation: "Only people that bought our sales pitch are in this fund."

"Load funds have better managers - you get what you pay for." Not true: no-load funds have been proven to out produce loaded funds when the sales charge is taken into account.

"Don't worry, you don't pay me a dime in commission - it comes from the fund company" Finally a true statement. However, where do you think the fund company got that money? They took it from you to pay the salesperson.

"If you hold the fund for five years, you won't pay a load." Many load funds are set up like this. It's a great way to keep you from selling their poor mutual fund. "I'll give you free investment advice, a no-load fund company won't do that for you." I'd rather have no advice than advice from a biased salesperson.