Very much appreciate retired...thank youI agree that holding the exact same funds in taxable and the IRAs makes avoiding wash sales more difficult. For that reason, I just don't do that because I never want to give even 1 minute's thought to whether I'm going to create a wash sale or not.
***Thank you retired...and livesoft...for your advice and opinions on wash sales. Up until this point I've never much considered and admittedly don't fully understand...and that shows in the way I built this portfolio. Can someone give me an example of a future transaction I might consider that would be complicated because of wash sale worries...or point me to material to familiarize on the subject?
I am not a believer in putting a certain kind of stock in IRA because it has been a dog and I expect it to continue to be a dog. That is recency bias...making decisions based on how an asset class has performed recently. I try not to let recency affect my investing decisions.
***Retired...after I received this advice from livesoft...I looked up SWISX and SWTSX performance comparisons over the past 1, 3 and 10 years periods. 1 year return for SWISX/SWTSX was 8.32 vs 19.15...3 year was 4.40 vs 8.93 and 10 year was 4.75 vs 11.84. Do these extended return comparisons have bearing on your thoughts? I'm trying to develop my thought process on this (fully knowing that past performance may have no bearing on future returns)...and want to understand the different ways to view.
Having said that, I do like simplicity. Since you do not have room in the taxable account for all of your foreign stocks, it would be fine to put all of the international in your IRA.
Along with 500 index (not total stock because of wash sales) and all of your bond allocation (except a small allocation to cash in taxable).
***I'm thinking of following this advice and moving the SWISX value to tIRA from Roth and filling Roth w/ SWTSX 100%. If I move the value of taxable acct SWISX to tIRA as well and replace with SWTSX...I assume that leads to a taxable event...am I incorrect?
***Also I'm not totally understanding when you mention below:
IRA
500 index (with or without an extended market index to complete it)
You would end up with
taxable
total stock
some money market
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IRA
500 index (with or without an extended market index to complete it)
total international
bonds
Roth IRA
500 index
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Should you do this? Yes, you should pay attention to the wash sale issues unless you want to specifically watch for wash sales any time you sell something in taxable (at a loss).
Is it going to make a difference if you hold some of your Roth IRA in international? Maybe. Maybe not. There is no way to predict and even if you could predict, the difference is going to be trivial. Change it if you want. Don't change it if you don't want. It's fine either way.
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You have way more money that you'll need in your lifetime. Most of the smaller details are not going to matter much for you anyway.
Statistics: Posted by estrellamts — Mon Feb 26, 2024 4:24 pm — Replies 9 — Views 1059