Seeking advises on using fidelity managed account on my taxable account

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Topic Author
reyw
Posts: 2
Joined: Wed Jul 21, 2021 4:29 pm

Seeking advises on using fidelity managed account on my taxable account

Post by reyw »

Hi All,

I have learnt a lot from this forum and decide to consolidate my accounts.

I have two questions:
1. which investment approach should i choose on my Taxable account? The account is about $600k with many handpicked stocks and ETFs right now.
My options are 1. 3 funds strategy as advised on this forum; 2. two fidelity managed account: 0.5% fee to track SPY and 0.7% fee to track international market. The selling point from my advisor is that the managed account has an aggressive loss harvest strategy which will provide similar cost comparing to index fund's dividend tax and lower fee. With the upcoming tax hike, I am not sure whether it makes sense to use such service mainly for tax purpose.

2. What should I invest in my Roth IRA? About 100k.
I have Apple stock, REIT, XLU and IDV in the account now, and consider whether to consolidate it into the 3 Index, bonds or choose my most aggressive bet (say Tesla)?

Some background of myself:
35 years old, married with two kids.
Enough savings (not in investment) to cover 12+ months of emergency funds. Considering to buy another investment property.
My only debt is 1.5M house mortgage with 2.375% APR (i pay $200 extra on top of the $5800 monthly payment)
Highest tax bucket in both federal and state (California)
I max out the 401k, mega backdoor after tax 401k, traditional IRA (also doing backdoor) every year.
My desired asset allocation is: 70% stock, 20% bond, and 10% other investment (5% gold, 5% crypto). most of my bonds are in 401k, when there is 50k muni bond in taxable account.
International stock allocation is about 20%, bond allocation is about 10%
I have a IUL (I learnt it is a stupid investment now) and plan to transfer it to Fidelity low cost VA, so Uncle Sam can share the loss with me.
Topic Author
reyw
Posts: 2
Joined: Wed Jul 21, 2021 4:29 pm

Re: Seeking advises on using fidelity managed account on my taxable account

Post by reyw »

:) Any suggestions?
User avatar
WinstonTeracina
Posts: 10
Joined: Sat Jul 17, 2021 6:38 am

Re: Seeking advises on using fidelity managed account on my taxable account

Post by WinstonTeracina »

reyw wrote: Wed Jul 21, 2021 5:01 pm Hi All,

I have learnt a lot from this forum and decide to consolidate my accounts.

I have two questions:
1. which investment approach should i choose on my Taxable account? The account is about $600k with many handpicked stocks and ETFs right now.
My options are 1. 3 funds strategy as advised on this forum; 2. two fidelity managed account: 0.5% fee to track SPY and 0.7% fee to track international market. The selling point from my advisor is that the managed account has an aggressive loss harvest strategy which will provide similar cost comparing to index fund's dividend tax and lower fee. With the upcoming tax hike, I am not sure whether it makes sense to use such service mainly for tax purpose.

2. What should I invest in my Roth IRA? About 100k.
I have Apple stock, REIT, XLU and IDV in the account now, and consider whether to consolidate it into the 3 Index, bonds or choose my most aggressive bet (say Tesla)?

Some background of myself:
35 years old, married with two kids.
Enough savings (not in investment) to cover 12+ months of emergency funds. Considering to buy another investment property.
My only debt is 1.5M house mortgage with 2.375% APR (i pay $200 extra on top of the $5800 monthly payment)
Highest tax bucket in both federal and state (California)
I max out the 401k, mega backdoor after tax 401k, traditional IRA (also doing backdoor) every year.
My desired asset allocation is: 70% stock, 20% bond, and 10% other investment (5% gold, 5% crypto). most of my bonds are in 401k, when there is 50k muni bond in taxable account.
International stock allocation is about 20%, bond allocation is about 10%
I have a IUL (I learnt it is a stupid investment now) and plan to transfer it to Fidelity low cost VA, so Uncle Sam can share the loss with me.
1) Why are looking to to change investment approaches at all? Do you have large, concentrated holdings you're looking to get rid of? What sort of capital gains are you looking at if you sell your existing stocks and ETFS in the taxable account?

2) Equitities or Equity index funds are appropriate for your Roth, I wouldn't hold any bonds there during my accumulation years.
70% - VT | 30% - Series I bonds + cash
backpacker61
Posts: 778
Joined: Wed May 20, 2020 6:36 am

Re: Seeking advises on using fidelity managed account on my taxable account

Post by backpacker61 »

reyw wrote: Wed Jul 21, 2021 5:01 pm I have two questions:
1. which investment approach should i choose on my Taxable account? The account is about $600k with many handpicked stocks and ETFs right now.
My options are 1. 3 funds strategy as advised on this forum; 2. two fidelity managed account: 0.5% fee to track SPY and 0.7% fee to track international market. The selling point from my advisor is that the managed account has an aggressive loss harvest strategy which will provide similar cost comparing to index fund's dividend tax and lower fee. With the upcoming tax hike, I am not sure whether it makes sense to use such service mainly for tax purpose.

2. What should I invest in my Roth IRA? About 100k.
I have Apple stock, REIT, XLU and IDV in the account now, and consider whether to consolidate it into the 3 Index, bonds or choose my most aggressive bet (say Tesla)?
Your question is a little bit like walking into a christian church and asking, "What religion should I practice?". :?

Many here will advise going with the 3 fund portfolio, of course, because, after all, these are the Bogleheads forums.

I would suggest limiting individual stocks to 5% of your portfolio, and hold your most aggressive growth investments in the Roth.

Hold tax inefficient investments in tax deferred registrations, if you have any.
“Now shall I walk or shall I ride? | 'Ride,' Pleasure said; | 'Walk,' Joy replied.” | | ― W.H. Davies
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