Major Wall Street, business, political and consumer finance magazines are warning investors about hidden 12b-1 and 401(k) fees, various share classes and the loads ascribed to them.

The fund industry-commentators are erroneously telling them-is conspiring to rip average investors off. The brokerage industry, they quickly add, are not only incensed. They are perfectly livid.

The truth of the matter is that 12b-1 fees are certainly part of the overall fund expense ratio. But they are only part.

A quick primer would start with the fact that 12b-1 fees are capped at 25 basis points. These are used for marketing, advertising and ongoing support for fund companies' brokerage and financial sales partners. And whereas trailing sales loads can be as high as 3% to 5% depending on the type of active management and performance record offered, 12b-1 fees are actually a small number.

A 0.25% charge on a mutual fund with $10 million under management would collect $25,000 a year. Let's just say that there are 1,000 people invested in this fund, with an average balance of $10,000, What is each person paying a year? A whopping $25.

You heard that right. Twenty-five bucks.

The more critical question, actually, is: What are the other charges. And-What is the most expensive fee outside of management charges?

Transaction fees, otherwise known as trading or portfolio turnover fees, are well over 1% or more a year due to the trend of mutual fund portfolio managers buying and selling stocks with ever-increasing frequency, paying between one cent to seven or eight cents a trade.

Ever since the May 6 "Flash Crash" near-1,000-point plummet in the Dow Jones Industrial Average and ensuing volatility in the stock markets-mutual fund and other institutional portfolio managers have more justifiable cause than ever before to move in and out of positions.

Even the most sophisticated 401(k) consultant or CFA struggles with the total cost of various shares held in qualified or non-qualified plans. Vern Sumnicht, an ETF proponent whose Sumnicht & Associates practice has been honored by Worth magazine as one of America's top wealth advisers in 2005, 2006, 2007 and 2008-says it took him 20 years to finally listen to the gospel warnings of Vanguard founder Jack Bogle on transaction costs.

Next time you finish an article slamming the mutual fund and brokerage industries over a 12b-1 or any other standard fee, run the numbers. It might just be much ado about next to nothing.

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