flintnational
Thinks s/he gets paid by the post
IMO, fund and management expenses tend to get lost when compared to total returns (particularly in an up market). Here is another way to look at the expenses.
Current structure
Annual management fee 1.8%
Fund fees .5% (I used the low estimate from other posters)
Total annual costs 2.3%
If you are using a firecalc type SWR strategy of about 4% annually, these expenses have to be subtracted. So you are left with 1.7% to spend (4% - 2.3%).
OTOH, if you build a 2 fund portfolio with Vanguard total stock market index admiral shares (VTSAX .04% expense ratio) and Vanguard total bond market index admiral shares (VBTLX .05% expense ratio) your blended expense ratio will be around .045%. This would leave you 3.955% to spend (4% - .045%).
Summary: Current WR less expenses 2.3%
Vanguard WR less expenses 3.955%
The Vanguard structure would increase your net WR by 71%
Current structure
Annual management fee 1.8%
Fund fees .5% (I used the low estimate from other posters)
Total annual costs 2.3%
If you are using a firecalc type SWR strategy of about 4% annually, these expenses have to be subtracted. So you are left with 1.7% to spend (4% - 2.3%).
OTOH, if you build a 2 fund portfolio with Vanguard total stock market index admiral shares (VTSAX .04% expense ratio) and Vanguard total bond market index admiral shares (VBTLX .05% expense ratio) your blended expense ratio will be around .045%. This would leave you 3.955% to spend (4% - .045%).
Summary: Current WR less expenses 2.3%
Vanguard WR less expenses 3.955%
The Vanguard structure would increase your net WR by 71%
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