With thousands of mutual funds to choose from, selecting the funds appropriate for your needs can be a challenge.

Before you begin making investment selections, you should review your situation. What is your investment goal? How long do you plan to keep your money invested? How comfortable are you with changes in the value of your investment over short and long periods? You should also familiarize yourself with the principles of asset allocation and diversification. Finally, before you invest in a mutual fund, carefully examine its performance, fees and any sales charges.

All funds have annual fees and expenses, which are used to compensate their professional managers and cover operating expenses. These fees may include a 12b-1 fee, which is collected to cover marketing and distribution costs and is periodically deducted from the fund’s earnings each year.

Some funds also apply a sales fee. These funds are known as “load” funds. The sales load, or fee, compensates the commission-based broker who sells you the fund. When evaluating load funds, which charge either a front-end load (A shares), a back-end load (B shares), or a level load (C shares), consider your investment goals and time frame as they relate to how and when the fees are paid. Before buying a fund that collects a sales charge, consider its performance record net of sales charges. (For a detailed overview of the types of mutual funds and their charges, fees and expenses, click here.)

Many investors choose to work with qualified financial advisors who can assist them in choosing funds to pursue their financial goals.

No matter what your decision, remember to evaluate your specific goals and personal investment style. With a long-term strategy, you’ll be more prepared to select the alternatives that can offer you the best value over time.