# Understanding fees and costs

## How Fynbos fees work

Fynbos uses a simple, transparent fee structure. Unlike many investment platforms that charge percentage-based fees on your total portfolio (Assets Under Management or AUM fees), Fynbos charges a flat monthly subscription fee.

- **No AUM fees**: We do not charge a percentage of your investments
- **No brokerage fees**: We do not charge fees when you buy or sell investments
- **No advisor fees**: We do not charge for the investment guidance built into our platform
- **Flat subscription**: One predictable monthly cost, regardless of how much you invest

This approach means the more you invest, the more cost-effective Fynbos becomes compared to percentage-based platforms.

## Subscription plans

Fynbos offers two subscriptions to suit different needs:

| Plan | Monthly cost | What you get |
| --- | --- | --- |
| **Roots** | Free | Emergency Savings, Tax-Free Savings Account (TFSA) |
| **Protea** | R100 | Everything in Roots, plus Savings pots, Investment accounts, and children's accounts |

Your subscription is billed on the first day of each month. If you upgrade mid-month, you only pay for the remaining days of that month.

## Fund fees (Total Expense Ratios)

While Fynbos does not charge AUM or brokerage fees, the underlying investment funds have their own costs called **Total Expense Ratios (TERs)**. These are industry-standard fees charged by fund managers for managing the investments.

**What is a TER?**

A Total Expense Ratio is the annual cost of running a fund, expressed as a percentage of your investment. It includes the fund manager's fees, administrative costs, and other operational expenses. TERs are automatically deducted from the fund's returns before you see them.

**What this means for you**:

- TERs are built into the fund's performance - you do not pay them separately
- When you see a fund's return, TERs have already been accounted for
- Lower TER funds keep more of your returns

## Comparing fee types

Understanding the different types of fees helps you make informed decisions about where to invest:

| Fee type | Description | How it affects you |
| --- | --- | --- |
| **Platform subscription** | Fixed monthly fee charged by the platform | Predictable cost, does not increase with your balance |
| **AUM fee** | Percentage charged on your total investment value | Grows as your portfolio grows, compounds over time |
| **Brokerage fee** | Fee charged when buying or selling investments | Reduces the amount actually invested |
| **TER (fund fee)** | Annual cost of the underlying fund | Built into returns, varies by fund |

Fynbos only charges a platform subscription. Other platforms may charge AUM fees, brokerage fees, or both in addition to subscription costs.

## Why flat fees matter

Percentage-based fees can significantly impact your long-term returns due to **compounding loss**. When fees reduce your invested amount, you lose not just the fee itself but also the growth that money could have generated.

**Example**: Consider two investors with R100,000, both earning 10% annually over 30 years:

- **Investor A** (0.5% AUM fee): Ends with approximately R1.2 million
- **Investor B** (flat fee only): Ends with approximately R1.7 million

The difference comes from compounding loss - the AUM fee reduces the principal each year, which reduces future growth.

> **Tip**: Use our Cost Calculator to compare how different fee structures affect your specific investment scenario.

## How fees are charged

**Platform subscription (Protea plan)**:

1. Your subscription is billed monthly on the first of each month
2. Payment is processed via card or debit order
3. If payment fails, you have a grace period before account access is affected
4. You can view all invoices in **Settings** > **Invoices**

**Fund TERs**:

1. TERs are calculated daily based on your fund holdings
2. The cost is automatically deducted from the fund's value
3. You do not see a separate charge - it is reflected in the fund's price
4. TERs are disclosed in each fund's fact sheet

## Viewing your costs

You can track your subscription costs in the Fynbos app:

1. Navigate to **Settings** from the home screen
2. Tap **Subscription** to view your current plan
3. Tap **Invoices** to see your billing history

Each invoice shows the billing date, amount, and payment status.