Governments incentivize retirement savings by allowing individuals to place their savings in tax-advantaged accounts where the returns to financial assets receive special tax treatment. In “back-loaded” accounts, the individual contributes pretax money and pays taxes when the money is distributed. In “front-loaded” accounts, the individual contributes aftertax money and pays no future taxes. A well-known benchmark result is that under some simplifying assumptions the present value of government revenue is identical under the types of account and the individual is indifferent to which type of account is offered. We introduce investment management fees to the model, and show that the equivalence results no longer hold. By postponing tax revenue in a back-loaded scheme, the government leaves its future revenue in a virtual account that pays real asset-management fees, implicitly subsidizing the asset management industry at the expense of government revenue, and ultimately of the taxpayer. We examine a simple model that allows for both benefits and costs to devoting additional resources to asset management, and we calibrate the model using data on investment management fees in 401(k)s and IRAs. We find that a system of back-loaded taxation generates a larger asset management industry than one with front-loaded taxation. In a preliminary calibration of a general equilibrium model, we find that this increase in the size of the asset management industry causes lower consumer welfare.