Skip to main content
Source: my image

Cost comparison: Selma vs. Swiss Bank šŸ‡ØšŸ‡­

Carina
by: Carina WetzlhĆ¼tter8 min read

The financial industry is famous for its complex pricing and hidden fees. This practical price example gives you clarity.

Selma is three times cheaper

The listed costs areĀ notĀ estimates, but real numbers found on the bankā€™s web page and in its fund prospects. Out of pure courtesy, we will not publish this bank's name.

a. The bank (mutual fund)

Investment amount: CHF 10'000
Annual management fee: from 0.6% - 1.23%
Product's own costs: 0%
Transaction fee: Transaction fees not included
Asset-based fee: 1%
Exit Fee: Specific information missing
Swiss tax statement: CHF 10 per fund, min. CHF 25 + VAT
Deposit costs: Minimum CHF 90 / year
Total costs per year: CHF 290 - 353 / year(ca. 2.9% - 3.53% in the first year)

b. Selma šŸŒŸ

Investment amount: CHF 10'000
Annual management fee: 0.68% (max)
Product's own costs: 0.22% (average)
Transaction fee: 0%
Asset-based fee: 0%
Exit Fee: 0%
Swiss tax statement: inclusive
Deposit costs: 0%
Total costs per year: CHF 90(0.90%)

What does that mean in practice?

Let's assume you would earnĀ a stable return of 5% on your initial CHF 10'000 investment every year. After 15 years, in 2037, once robots have taken over the world and Elon Musk has built a Hyperloop from NY to Paris, this is where you stand:Ā 

a. The bank (mutual fund)

Initial Investment: CHF 10'000
Return of Investment: 5% p.a.
Costs in first year: 2.90% p.a.
Running costs after the first year: 1.9% p.a.
Account balance in 15 years: CHF +15'650.05
Profit in 15 years: CHF 5'650.05

b. Selma šŸŒŸ

Initial Investment: CHF 10'000
Return of Investment: 5% p.a.
Costs in first year: 0.90% p.a.
Running costs after the first year: 1.9% p.a.
Account balance in 15 years: CHF +18'270.90
Profit in 15 years: CHF 8'270.90

TL;DR

On first glance, many offers look great and fair. But be careful with hidden costs!

āš ļø Read the small print āš ļø - Be aware of the transaction costs & exit fee.

Because of the compounding costs, the difference is staggering 2'620.85 CHF. It's 26.21% of your initial investment!

For us transparency is fundamental. Try out Selma for free and get your personal investment plan in just 5 minutes.

Try Selma for free!

About the author
Carina

Carina WetzlhĆ¼tter

Carina makes technology understandable. As the former marketing lead of a complex software product, she joined Selma to help explain finance in a more human way. Winter being her favorite season, she loves ā„ļø and šŸŽæ

LinkedIn