What are custodial fees?

Custodial fees are payments to the person or entity that manages your investments, called "custodians." When you invest in stocks, bonds, and mutual funds, or become an owner of a security, the broker takes cash out of an account and pays the person or institution from whom you are making the acquisitions.

Do online brokerage firms charge custodial fees for IRAs?

Most online discount brokerage firms do not charge custodial fees for IRAs, or they waive them for people who opt in to receive documents and statements electronically. Vanguard, which is known for having some of the lowest fees in the industry, will charge you as much as $20 in custodial fees per fund you hold.

How much does Vanguard charge for custodial fees?

Vanguard, which is known for having some of the lowest fees in the industry, will charge you as much as $20 in custodial fees per fund you hold. However, you can completely avoid these fees by agreeing to receive documents electronically, or by maintaining a $10,000 balance in each fund.