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Converting VTSAX to VTI in brokerage account? Is it taxable?

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  • Converting VTSAX to VTI in brokerage account? Is it taxable?

    In general I prefer index mutual funds over ETF's but then I came across this article.
    https://humbledollar.com/2020/09/it-sure-adds-up/
    Although the ER difference is minimal compared to an active/passive mutual fund, it still can add up. I was wondering if I switch VTSAX--> VTI in a brokerage account at Vanguard, will I have to pay capital gains tax? Same with all the other vanguard mutual funds--> ETFs.

    Thanks.

  • #2
    https://investor.vanguard.com/etf/faqs

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    • #3
      I've been considering the same thing, but mostly to make future tax loss harvesting easier

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      • #4
        The numbers have to be fairly larger before an ER makes a meaningful difference between the Admiral shares and the similar ETF (think 200K+) IMO.

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        • #5
          From the article referenced by the OP, starting with $350K after 25 yrs VTI would have $6.9K advantage over VTSAX. The annualized return is ~7% over the lifetime which is ~$1.9M. Rounding error.

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