How Much Does Investing Really Cost You? Discover Where You Are Losing Thousands of Euros

Fees are, immediately after returns, the most important number in the world of investing. Even small percentage differences, over decades, turn into thousands of euros less in your account. For example, with a one-time investment of 10,000 euros, the difference between a fee of 1% and 2% over 30 years can mean about 18,000 euros less in returns.

The level of costs depends on the method of investment – independently, through funds, brokers, or digital platforms. Management and platform fees, transaction and custody costs, entry and exit fees, and for funds, the total expense ratio (TER), which is not directly visible but deducts part of the returns in advance, come into play.

Digital platforms lower the cost of investing

Automated digital investment platforms have become one of the most accessible ways to invest for the general public in recent years. The investor enters their data, the algorithm suggests a strategy, and the system automatically manages the portfolio.

– If someone is hesitant to invest independently or does not want to pay expensive advisors, digital platforms can be the solution. They compile the portfolio instead of the investor, take care of management, and often offer assistance with tax reporting. Total annual fees for such a service should not exceed about 1.5% of the investment value – says Emilio Gučec, an analyst at Finax, a robo-advisor that offers automated investment in ETFs.

In the case of completely independent investing, he adds, the total costs of buying, selling, and holding securities should not exceed about 0.5% annually. However, he also warns about platforms with “zero” or unusually low fees, which may compensate for the difference through a wider spread, currency conversion fees, or order execution structure, which is more suitable for experienced investors.

Some digital platforms occasionally use zero management fee promotions to attract new clients. Finax used the end of 2025 for such a promotion: a client who invests in December 2025 will not pay a management fee throughout 2026.

According to their calculations, with an investment of 10,000 euros, such a fee-free year can yield savings of about 100 to 300 euros, depending on what the standard fee would otherwise be. For investors who plan to invest long-term anyway, such promotional periods can be an opportunity to reduce costs – provided that the investment strategy and risk level are clearly defined.

Active management is significantly more expensive

The highest costs are associated with traditional active portfolio management services. – Active management involves constant market monitoring and making investment decisions, which is also reflected in the account. In practice, we often encounter total costs of 2 to 3% of the value of assets under management, plus possible entry, exit, or performance fees – says Gučec.

One of the examples he cites: with an investment of 100 euros per month over 30 years, with a management fee of 2%, an entry fee of 2%, and a performance fee of 10%, total costs based solely on fees could approach 54,000 euros. Compared to automated platforms with total costs of about 1% annually, the difference for the client could be up to 31,000 euros.

Tax as a third key factor

Along with the level of fees and returns, the tax perspective also plays an important role. For Croatian residents, the rule applies: if the investment is held for more than two years, the profit upon sale is exempt from capital gains tax. If sold before the expiration period, a tax of 12% is paid on the realized profit.

The combination of lower fees and proper management of tax obligations thus becomes one of the key ways for an investor to maximize net returns in the long term – without increasing risk, only through discipline in selecting products and investment channels.