what is a front end load 
a front end load is a commission or sales charge applied at the time of the initial purchase of an investment the term most often applies to mutual fund investments but may also apply to insurance policies or annuities the front end load is deducted from the initial deposit or purchase funds and as a result lowers the amount of money actually going into the investment product front end loads are paid to financial intermediaries as compensation for finding and selling the investment which best matches the needs goals and risk tolerance of their clients so these are one time charges not part of the investment s ongoing operating expenses the opposite of a front end load is a back end load which is paid by deducting it from profits or principal when the investor sells the investment there are also other types of fund loading including level loads which charge an ongoing annual fee 1the basics of front end loadsfront end loads are assessed as a percentage of the total investment or premium paid into a mutual fund annuity or life insurance contract the percentage paid for the front end load varies among investment companies but typically falls within a range of 3 75 to 5 75 lower front end loads are found in bond mutual funds annuities and life insurance policies higher sales charges are assessed for equity based mutual funds mutual funds that carry front end loads are called load funds whether an investor pays a front end load depends on the type of shares in the fund that he owes class a shares also known as a shares typically carry a front end load generally the sales charge on a load mutual fund is waived if such a fund is included as an investment option in a retirement plan such as a 401 k 2