Breakpoint
Certified Financial Planner glossary · Certified Financial Planner
Definition
A purchase threshold at which a mutual fund’s front-end sales charge is reduced.
Breakpoint in plain English
A couple is $5,000 short of the next mutual-fund share-class sales-charge tier, and the rep never mentions it. A breakpoint is the purchase level at which a front-end load is reduced. Rights of accumulation and letters of intent can aggregate purchases to reach that tier. Missing a nearby breakpoint is a classic suitability and ethics failure. If the vignette shows a buy just under a published breakpoint schedule, ask whether aggregation was offered.
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