Daily Advice Thread - All basic help or advice questions must be posted here.

I did that and those are the sorts of numbers that I am seeing. Using a yield of 10% and an SEC yield of 2.4% I see a tax drag of about 1.4% over 20 years for my tax bracket (24%, assuming all short term gains) relative to an identical passive fund.

I guess the next question - is this such a big deal? It's a 1.4% difference in overall taxes worst case assuming all short term gains, but someone is managing and balancing the fund. It assuming current tax brackets, and assumes that I am cashing out everything in 20 years lump sum, where I would probably draw over the span of years. We're also assuming identical performance between all of these funds which probably won't happen.

I guess it basically comes down to whether I feel whether this difference in tax treatment and expense ratio is worth the benefit of having someone managing the portfolio and balancing it.

/r/investing Thread Parent