VEU or VTI in taxable?

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Topic Author
atDev
Posts: 69
Joined: Thu Apr 08, 2010 8:05 pm

VEU or VTI in taxable?

Post by atDev »

Which should I allocate to in my taxable account first?
* Vanguard Total Stock Market ETF (VTI)
* Vanguard FTSE All-World Ex-U.S. ETF (VEU)
Ben | Young Investor and Learning
avalpert
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Joined: Sat Mar 22, 2008 4:58 pm

Post by avalpert »

I would choose VEU first so that you can take advantage of the Foreign Tax Credit - they should have similar tax efficiency
Topic Author
atDev
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Joined: Thu Apr 08, 2010 8:05 pm

Post by atDev »

Ok thanks..

Would Vanguard REIT ETF (VNQ) be better in traditional or roth IRA?
Ben | Young Investor and Learning
caklim00
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Post by caklim00 »

VEU for the reason noted above, but VTI is extremely tax efficient as well. My taxable account is where I hold VEU (beyond 401k equivalent), with a small amount of VTI...
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SpringMan
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Location: Michigan

Post by SpringMan »

atDev wrote:Ok thanks..

Would Vanguard REIT ETF (VNQ) be better in traditional or roth IRA?
It is okay in either. I have a preference to hold it in a Roth because, being equity, it has more expected return than bonds and Roths are generally the last IRAs to be tapped. One reason being that Roth IRAs are not subject to RMDs at age 70.5.
Best Wishes, SpringMan
livesoft
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Post by livesoft »

You have a similar thread already going:
http://www.bogleheads.org/forum/viewtopic.php?t=53311

In that thread, I answered the same question as you posed here. I vote for VEU in taxable first.

As for VNQ in Roth or traditional, I wrote this:
Put things that will gain the most in the Roth accounts instead of the traditional accounts, but since Roth is usually precious future tax-free space, you do not want to put things that have too high a potential for losses since you cannot get a tax break for losses in a Roth.

Notice that I just wrote two opposing principles for a Roth since the investments that will gain the most are also the ones that will lose the most.
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