But does it make sense to diversify beyond and index fund (say an international index fund for example) if my account balance is less than $5,000 I would have to pay $10/fund plus $10/index fund. That's $40 a year just to have the fund vs. $20 if I have only one fund. I wonder if the return would offset the cost? (depending on how long it would take me reach $5000 in my Roth) **********Rob, The following is a one of my prior posts about Vanguard Fees...with one bit of additional information that I neglected to include on the first one.Vanguard Fee Structure for IRA Accounts:Custodial Fee: $10/year for every fund, index or not, in the account that has less than 5k. Custodial Fees are waived if you have a combined total of 50k in all of your accounts. Maintenance (Portfolio) Fee: For index funds only. Charged quarterly (if the dividends for that fund are paid out quarterly) for every fund that contains less than 10K. For Taxable Accounts:There are no custodial fees.The maintenance fee (index fee) is the same as for the IRA accounts: $10/year, usually paid out of your dividends, and charged quarterly ($2.50) if the dividends are paid quarterly. (If the dividends are paid annually, such as for the Small Cap Index Fund, then they are charged annually.)There is a low-balance $10/year charge for accounts that fall below $2500. For all accounts, taxable and tax-advantaged:Maintenance fees are not waived with the 50K combined total. To waive an index (maintainence fee) you must have that 10K in each fund.*************Additionally, the following article might be of interest to you.Article on Vanguard v. TIAA http://www.indexfunds.com/articles/20001115_VG-TIAA_com_tax_JK.htm Caat
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