Most mutual fund companies now charge investors an annual 12b-1 fee -...

Most mutual fund companies now charge investors an annual 12b-1 fee - totaling more than $10 billion in 2004 - instead of charging investors a one-time upfront fee, according to a new survey conducted by the Investment Company Institute. Fifty-two percent of mutual companies use the fees to pay for ongoing shareholder services, such as responding to customer inquiries and providing information on investments, as well as record keeping; 40% used the fees to compensate financial advisers, brokers and other intermediaries; and only 2% used them to pay for promotion and advertising. The remaining 6% went to mutual fund underwriters to cover some of their costs.