Hello all,
Just curious about your options for using a balanced fund in a taxable account as a core holding. After getting hit with a rather large tax bill for 2016, I'm looking to put together a more tax efficient portfolio. I'm paring back on some income producing CEFs and looking to put that money to work in a more tame, tax efficient manner. Some options such as VBINX, CBLAX and VTMFX have appeared on my radar. Any other candidates? Thanks in advance.
Comments
But, IMO, using the 'wrapper' of a balanced fund to do so, is not the approach I would take. Instead, I would own separate stock & muni-bond vehicles (probably ETFs or CEFs), held in the desired stock/bond allocation. Why? - When stocks (or bonds) drop, you can use the taxability of your account as an asset, rather than a liability -- sell the item which is 'down', harvest the tax loss, then buy a similiar-but-not-identical ETF.
OTOH, the manager of a tax-aware balanced fund doesn't drive his/her decisions on what YOUR cost-basis is.
jmo