Expense Ratios!

Investing
#1

Hi there!

I had a question about investing in a 403b and more specifically if I should still invest/if it is sill worthwhile investing in international stocks (for their diversification) given that its overall/net expense ratio (0.5%) is so much higher than some of my other, more domestic options (large cap growth, value, and total US stocks at 0.0236; small cap at 0.3%).

I don’t believe that any of these funds are actively managed, they should all be passive.

It seems all relative – if I am willing to pay 0.3% for small cap, maybe I should be OK with investing in something that is only 0.2% more to take advantage of diversification.

Any thoughts would be much appreciated!

Best,
A

#2

Hey @Andres_Guzman!

Yeah, 0.5% is getting pretty high for my taste. If it’s me, I would probably diversify into international in another account? i.e. if you have a 403b and an IRA, you could do 100% total US stock market in your 403b, then in your IRA you could add the international. You might need to make a small spreadsheet to keep track of how much is where so you stay on your target asset allocation.

#3

That makes perfect sense; thank you so much for taking the time to reply!! :slight_smile:

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