With CRM3, or total cost reporting, set to take effect in 2026, financial advisors may want to drill down on fee conversations and prepare clients to review their annual statements.
As things stand under CRM2, investors’ clarity on the fees reported on their annual statements slipped year over year, according to the annual investor survey from the Securities and Investment Management Association (SIMA) and Pollara Strategic Insights, released Thursday.
Of the 60% of surveyed investors who said they read their annual fee and performance statements, 76% said the statements did an “excellent” or “good” job of clearly showing trailers, down from 79% the previous year. In 2023, the figure was 75%.
In contrast, 89% of the surveyed investors said the statements did an “excellent” or “good” job of clearly showing rate of return.
Tom Bradley, co-founder of Steadyhand Investment Funds Inc. in Vancouver, B.C., has suggested that fees be positioned next to performance, “where clients will actually see it” on the statements, he said.
Fee discussions also slipped in the annual survey. When investors were asked about their last fund purchase from an advisor, 58% said they discussed management expense ratios (MERs) and 56% said they discussed trailers, down from 60% and 64%, respectively, the previous year.
The two-percentage-point drop for the MER discussion is “pretty much within the margin of error,” Ian Bragg, vice-president of research and statistics with SIMA, said in an email.
Roughly one-third of investors in mutual funds and ETFs said they weren’t confident they understood how much they pay in MERs and trailers — a proportion the report described as “significant.”
Bradley said what he often hears from investors is, “My guy charges 1%” — the rate of a fee-based account with the investor having no understanding of product and other costs, including taxes.
With CRM3, “the industry is trying to go to the next step” of including all costs, he said. Advisors “should absolutely have nailed down exactly what a client’s total cost is, so they can unflinchingly answer that [fee] question and be up front.”
While some advisors may worry clients will think they’re paying too much, those advisors are “making it a one-sided equation,” Bradley said. “The other side of the equation is you build trust. If you’re going to have a long-term relationship with somebody, being totally transparent and having them understand what fees they’re paying and why … and what they are entitled to get for [those fees] is huge.”
Bradley’s advice to investors is to ask advisors about fees, including follow-up questions. “Then watch the body language,” he said. If the advisor is “squirming, or they’re being evasive or they’re saying it doesn’t matter because performance is what matters, then you know you’re paying too much.”
SIMA’s annual survey, which has tracked investor sentiment since 2006, broadened its scope this year beyond mutual fund and ETF investors to include investors in stocks, bonds, crypto and other investments. The change reflects SIMA’s expanded mandate to represent capital markets, wealth management and asset management.
The survey found that Canadian households most commonly hold mutual funds (41%), stocks (36%) and GICs (29%). Lower proportions held ETFs (21%), bonds (14%) and cryptocurrency (11%).
In total, 5,400 surveys were conducted with 4,384 investors and 1,016 non-investors, between July 8 and July 29, 2025.