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- Jun 25, 2005
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FinanceDude said:True, but I was referring to the fact that people can deduct their management fees on an annual basis on their taxes, what you are saying is true, but happens upon sale, which could be several years out............
Is it not true that one can deduct only those expenses that exceed 2% of your AGI and then only if you itemize? If that's true, I hope I never even come close to paying 2% of AGI in management fees.
And there are some very low expense ratios for some index funds. For example, in our 529 accounts, we own VIIIX with er of 0.03%. VTI, the total stock market index ETF, has an expense ratio of 0.07%. (Yes, I know there are a bid/ask spread and NAV issues.) It may be better to own VTI instead of a mixture of SPY, MDY, and IWM.