Hey guys,
So I just started seriously investing around 9 months ago now and have been putting money in both taxable and tax-deferred or Roth since that time. I'm a resident, but had some money saved up from prior to medical school, so I now have a little over 50k in taxable accounts, 26k in Roth (some is older or trad conversion), and 4k in tax-deferred.
I don't know exactly how much I'm down in all of my taxable accounts since starting to seriously invest last year, but I know my Betterment account is currently ~2,500 down from the original 14k. I'm sure my other taxable accounts at Fidelity and Vanguard are down a bit too.
It would be pretty simple for me to sell my entire Betterment account. I started there but after learning more I've been thinking about getting outta there and investing only at Vanguard (where my primary taxable account is) and Fidelity (where an old UTMA and my Roth and 403b/457 are). I could re-direct my 403b/457/DCP plans that will be contributed to Feb 1st to a Target Date fund (60% goes to that already), which wouldn't trigger a wash sale. Then, I could re-invest my Betterment sale monies into Vanguard in a non-identical fund.
My main question is this -- is it worth it, since my income will only increase in the years to come? If I tax-loss now, won't it just re-set my basis lower and then at some point whenever I actually sell I'll have to pay the difference, right? Any thoughts on this? I think my main goal will actually just be to hold the funds for indefinitely and try to survive on dividends whenever I'm ready to retire, so, theoretically, the tax basis should reset if it gets passed on to my kids, right? If that's the case, should I go ahead and tax-loss harvest now?
Thanks! Sorry that was so long. Also, please feel free to point out any incorrect thoughts or inconsistencies in my planning, since tax code and planning is probably my weakest area of finance.
So I just started seriously investing around 9 months ago now and have been putting money in both taxable and tax-deferred or Roth since that time. I'm a resident, but had some money saved up from prior to medical school, so I now have a little over 50k in taxable accounts, 26k in Roth (some is older or trad conversion), and 4k in tax-deferred.
I don't know exactly how much I'm down in all of my taxable accounts since starting to seriously invest last year, but I know my Betterment account is currently ~2,500 down from the original 14k. I'm sure my other taxable accounts at Fidelity and Vanguard are down a bit too.
It would be pretty simple for me to sell my entire Betterment account. I started there but after learning more I've been thinking about getting outta there and investing only at Vanguard (where my primary taxable account is) and Fidelity (where an old UTMA and my Roth and 403b/457 are). I could re-direct my 403b/457/DCP plans that will be contributed to Feb 1st to a Target Date fund (60% goes to that already), which wouldn't trigger a wash sale. Then, I could re-invest my Betterment sale monies into Vanguard in a non-identical fund.
My main question is this -- is it worth it, since my income will only increase in the years to come? If I tax-loss now, won't it just re-set my basis lower and then at some point whenever I actually sell I'll have to pay the difference, right? Any thoughts on this? I think my main goal will actually just be to hold the funds for indefinitely and try to survive on dividends whenever I'm ready to retire, so, theoretically, the tax basis should reset if it gets passed on to my kids, right? If that's the case, should I go ahead and tax-loss harvest now?
Thanks! Sorry that was so long. Also, please feel free to point out any incorrect thoughts or inconsistencies in my planning, since tax code and planning is probably my weakest area of finance.
Comment