Putnam Announces Changes to Fees for Retail Funds

Putnam Investments said it will make sweeping changes to the management fees on its retail mutual funds.

A Putnam news release said the changes are designed to provide investors with a host of immediate and long-term pricing benefits and to make Putnam’s product lineup more competitive in the marketplace. Certain changes will require the approval of shareholders at shareholder meetings to be held later this year.

As of August 1, management fees will be reduced from current contractual levels for mutual funds in the following product categories (on average, as of June 30):

  • Putnam Fixed Income Funds—a 13% reduction; ranging as high as a 34% reduction;
  • Putnam Asset Allocation Funds—a 10% reduction;
  • Putnam RetirementReady Funds—elimination of “wrap” management fees.

In addition, according to Putnam, U.S. growth funds, international funds, and the Putnam Global Equity Fund will have performance fees reflecting the strength or weakness of the investment performance of the given fund. Management fees for these equity funds will decline from their standard fee if the funds underperform their benchmarks and will rise if the funds outperform.

The asset-level discounts for investors will be based more broadly on the growth of all Putnam mutual fund assets, rather than the growth of an individual Putnam mutual fund’s assets. The company said every dollar invested in a Putnam mutual fund essentially benefits all Putnam mutual fund shareholders under this model.