Fund fees continue to fall and investors reap the rewards.

When a fund collects fees for providing payments or other services to fund managers, investors never see the bill. Cash is derived directly from the fund’s total assets. The fund indicates what percentage will cover such fees each year in a so-called expense ratio.

Fees for all types of funds have fallen significantly in recent decades, whether you invest in stocks, bonds, or a combination thereof. The decline is partially explained by investors flocking to lower-cost funds. In such cases, the fund may be able to spread its expenses over a broader base of dollars, potentially lowering its expense ratio. As a result, more investments may be attracted in the future and the cycle may continue.

Lower expense ratios mean a lower hurdle for a fund’s managers to overcome in order to outperform other funds after fees, which is important to investors.

Some types of funds typically have higher expense ratios than others, depending on their specialization. Funds that invest in stocks often have higher expenses than funds that invest in bonds, and lower yields can limit the return you can expect. Smaller niche areas that require further research by fund managers (such as high-growth stocks in smaller companies) may also come with higher price tags.

Fund fees are also falling as investors increasingly choose index funds. These funds don’t employ teams of analysts or managers hoping to beat the market. Instead, they try to track the S&P 500 or another index and typically charge fees close to zero.

One area where this trend reversed last year was money market funds. There, the average expense ratio increased by 0.09 points to 0.22%. This is mainly due to fewer funds offering shareholder expense exemptions.

For years, near-zero short-term interest rates have forced money market funds to waive fees to protect investors from losses. But over the past two years, the Fed has raised its key overnight rate to a range of 5.25% to 5.50%. This allows money market funds to collect more fees while still generating positive returns for investors.