Wouldn’t it be nice to get a Christmas bonus that is like winning the lottery and you could retire from it if you chose? But you might not want to retire if you could get one of these bonuses year after year whether you did a good job or not. In a year where Wall Street should be getting coal rather than sweet meats they are poised to award themselves 10% more in 2007 regardless of the mortgage mess they invested in. Most U.S. businesses – 66 percent – give no bonuses at all. Those employees lucky enough to receive a cash gift will get an average of $837. Compare that to the bonuses Goldman Sachs gives out, a jackpot so big they could give every employee more than $600,000."

Last year in 2006, Goldman Sachs gave $16.5 billion in bonuses to dozens of its bankers and traders. The top "rainmakers," as they are called, each took home as much as $20 to $25 million just in bonuses. Where did all that money come from? I don’t remember any stocks or funds making any investors millionaires. The total estimate for 2006 was around $100 Billion, the GNP of a small country was handed out as a bonus whether investors made money or not and I can assure investors were bamboozled as usual.

Yes, a record was made on Wall Street in 2006 but not for investor returns. The biggest bonus ever paid to a Wall Street chief executive didn’t last even a week. It was smashed by the $53.4 million that Goldman Sachs gave its chief executive, Lloyd Blankfein who was only in office a short time…I need one of these gigs.

The average bonus on Wall Street was $125,500 in the beginning of 2006 and will seem like chump change at the start of 2007 when bonuses averaging $650,000 are expected to have a major impact on first quarter sales numbers, despite the fact that many wire-houses have done terrible by investing in securities backed by risky home loans in the subprime debacle.

Did you ever wonder where all this money comes from? Is the market really up that much that these traders and managers deserve these bonuses? In my book, "The 3 Secret Pillars of Wealth" I disclose one of the places the bonuses are coming from…your pocket.

When you invest in the typical mutual fund (assuming outside of a qualified retirement plan), you face costs that erode your benefit. Chances are you’re not aware of them, they’re not in your prospectus and your broker isn’t going to sit down and tell you about them. The five costs of mutual fund investing are:

1. Tax costs – excessive capital gains from active trading.

2. Transaction costs – the cost of the trades themselves.

3. Opportunity costs – dollars taken out of portfolios for a fund’s safekeeping.

4. Sales charges – both seen and hidden.

5. Expense ratio, or "management fees" – no end to increases in site. This is a calculation based on the operating costs of the fund divided by the average amount of assets under management.

How radically do fund expenses affect you? Well, with the expense ratio, which averages 1.6% per year, sales charges of 0.5%, turnover generated portfolio transactions costs of 0.7% and opportunity costs of 0.3%—when funds hold cash rather than remain fully invested in stocks— the average mutual fund investor loses 3.1% of their investment returns every year just on fees. While this might not seem like much on the surface, costs and fees alone could consume 31% of a 10% market return. Think about that. You could be losing almost a third of your return before it’s even taxed. You’re losing a third of your return just for the cost of maintaining your investment. Add in the 1.5% capital gains tax bill that the average fund investor pays each year and that figure shoots up to 46% of your return being lost to fees and expenses, nearly half of a potential 10% return.

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