identical funds in taxable and non-taxable accounts

[alloykat]

Any drawbacks to having the same fund (VTSAX) in a taxable and non-taxable account in you have no plans to do TLH but rather just plan to hold forever?

[DarrVao777]

alloykat wrote:

Any drawbacks to having the same fund (VTSAX) in a taxable and non-taxable account?

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I have both. No drawbacks aside from the fact that you'll need to be cautious if you TLH in your taxable account.

[jfoxcpacfp]

alloykat wrote:

Any drawbacks to having the same fund (VTSAX) in a taxable and non-taxable account in you have no plans to do TLH but rather just plan to hold forever?

Click to expand...

No, and it's simpler. When allocating/rebalancing, you just need to include all accounts rather than do your calculations within each account. I would caution you to not choose a particular fund b/c you "love" it but because it is the best fund to fill a particular allocation need in your overall investment diversification plan.

[PhysicianOnFIRE]

alloykat wrote:

Any drawbacks to having the same fund (VTSAX) in a taxable and non-taxable account in you have no plans to do TLH but rather just plan to hold forever?

Click to expand...

If you own a taxable account, you should most definitely have plans to TLH. With our salaries, it's a $1000+ gift from the government every year, and simple to do.

With that in mind, I recommend against keeping "substantially identical" funds in retirement accounts that you have in a taxable account. Your investments and dividend reinvestments in the retirement accounts can create a wash sale.

Don't turn down free money. Swap back and forth between funds that behave the same (VTSAX & VFIAX) and reap the rewards.

Best,

-PoF