For those with $500k-$1m in investments...

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Admiral
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For those with $500k-$1m in investments...

Post by Admiral » Thu May 18, 2017 10:49 am

I'm curious to know what percentage of your invest-able assets (that is, liquid assets, so not including home equity) you have in a taxable account versus retirement accounts. I'm including Roth in retirement accounts even though in many cases these monies can be accessed penalty free. How the funds are invested does not concern me.

For example, someone that has a $700k portfolio might have:
10% in a taxable account
90% in tax advantaged accounts

If you want to add more detail, you could also note whether you add to your taxable account, and how much/how often.

Thank you.

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TxAg
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Re: For those with $500k-$1m in investments...

Post by TxAg » Thu May 18, 2017 10:53 am

5/95

Would like to pad the taxable more but we're at a point in life where we sometimes draw a bit from it. (35/32 with kids)
Last edited by TxAg on Thu May 18, 2017 2:15 pm, edited 1 time in total.

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David Jay
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Re: For those with $500k-$1m in investments...

Post by David Jay » Thu May 18, 2017 10:58 am

0.9% taxable, 99.1% tax advantaged overall, just retirement portfolio ($682K) 0%/100%
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Smorgasbord
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Re: For those with $500k-$1m in investments...

Post by Smorgasbord » Thu May 18, 2017 11:01 am

I am at 53% taxable, 47% tax advantaged. The main reason for the high taxable is that until my mid-30s I did not work for a company with a 401k. :annoyed

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David Jay
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Re: For those with $500k-$1m in investments...

Post by David Jay » Thu May 18, 2017 11:05 am

David Jay wrote:0.9% taxable, 99.1% tax advantaged overall, just retirement portfolio ($682K) 0%/100%


I am over 59 1/2 so I have access to my Roth funds without penalty, emergency cash is a HELOC.
Prediction is very difficult, especially about the future - Niels Bohr | To get the "risk premium", you really do have to take the risk - nisiprius

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jriding
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Re: For those with $500k-$1m in investments...

Post by jriding » Thu May 18, 2017 11:06 am

4% in taxable. Maxing out tax advantaged space (401k, 403b, HSA, Backdoor Roth IRAx2) and extra monthly mortgage payments is all we can handle.

bigred77
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Re: For those with $500k-$1m in investments...

Post by bigred77 » Thu May 18, 2017 11:07 am

I'm a smidge away from your lower bound (give me a year's more contributions and a flat market to get there) but I will answer anyway.

We are 100% in retirement accounts. The only thing we have outside of retirement accounts and home equity is a small but growing balance of cash that we are building up for family planning purposes. Everything else goes to debt pay down or is invested in retirement accounts.

Sandtrap
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Re: For those with $500k-$1m in investments...

Post by Sandtrap » Thu May 18, 2017 11:08 am

100% taxable
40-60x

kelvan80
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Re: For those with $500k-$1m in investments...

Post by kelvan80 » Thu May 18, 2017 11:09 am

38 and 100% retirement accounts, we are 80/20. DH will receive Military pension so we don't need access to taxable to retire early

nova1968
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Re: For those with $500k-$1m in investments...

Post by nova1968 » Thu May 18, 2017 11:17 am

Tax Advantage 96.5% (TSP 24K a year, ROTH 7K a year, HSA 4.5k a year)) Maxing out, plus catch up contributions allowed for over age 50
Taxable 3.5% Assets added for tax returns, cash gifts received, and occasional car sale

davegreen10
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Re: For those with $500k-$1m in investments...

Post by davegreen10 » Thu May 18, 2017 11:19 am

$50k emergency fund in taxable
$650k in tax adavantaged

Easy for us as we are barely able to max our tax advantaged accounts so not much left over for taxable

boglephreak
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Re: For those with $500k-$1m in investments...

Post by boglephreak » Thu May 18, 2017 11:20 am

26% in taxable.

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tyrion
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Re: For those with $500k-$1m in investments...

Post by tyrion » Thu May 18, 2017 11:23 am

Excluding the emergency fund, it's 7% taxable and 93% tax deferred. Mid 40s. We max out retirement accounts and add 200-300/month to a tax efficient stock fund in a taxable account.

I think people with a large % in taxable will be in one of several camps:
1 Received inheritance/windfall (stock options, business sale, etc)
2 Limited tax deferred investment options (no 401k, etc)
3 Highly compensated younger folks who will soon leave your 500k - 1 Mil range.

NoD
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Re: For those with $500k-$1m in investments...

Post by NoD » Thu May 18, 2017 11:25 am

8% taxable, 92% deferred.
Some day we'll look back on all this and plow into a parked car.

Nate79
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Re: For those with $500k-$1m in investments...

Post by Nate79 » Thu May 18, 2017 11:26 am

10% excluding cash reserves/savings account/EF.

Dollarsign16
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Re: For those with $500k-$1m in investments...

Post by Dollarsign16 » Thu May 18, 2017 11:28 am

mid 30's - just venturing an estimate without looking, I'd say around 20% taxable, 80% tax advantaged... maybe even more skewed higher than 80%... I know its a vast majority split between two Roths, two rollover IRAs and a 401K and 403B. We're trying to up our taxable amount.
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niceguy7376
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Re: For those with $500k-$1m in investments...

Post by niceguy7376 » Thu May 18, 2017 11:30 am

3/97
Dont have much leftover in a 5 digit wages after 401k/simple ira/hsa.

I count on my taxable as emergency second level (first level is checking) / retirement account. Invested as part of retirement AA though.

thomasbayarea
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Re: For those with $500k-$1m in investments...

Post by thomasbayarea » Thu May 18, 2017 11:31 am

30/70

topofthebellcurve
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Re: For those with $500k-$1m in investments...

Post by topofthebellcurve » Thu May 18, 2017 11:33 am

32, 1.2MM liquid, ~90% taxable. No 401(K) when I was in Hong Kong, sadly.

But now I'm an independent contractor and can fund $53K/yr into a SEP-IRA. Hoping to balance out in a few years!

Jack FFR1846
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Re: For those with $500k-$1m in investments...

Post by Jack FFR1846 » Thu May 18, 2017 11:33 am

Although I'm well out of your range, I would say that my goal is always to fill tax advantaged first. Heck....at 60 years old, my first real taxable accounts were only opened last November. I do have a significant number of US Savings bonds, however. I add to taxable with extra money after each tuition payment for my son's college. 401k to max, Roth for wife and me to max, wife doesn't have 401k/403b.

advantaged 79.3%
savings bonds 17.1%
taxable equity 3.5%
cash 2%
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Dottie57
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Re: For those with $500k-$1m in investments...

Post by Dottie57 » Thu May 18, 2017 11:35 am

6% in taxable. Have 401k, TIRA and Roth IRA.

Whatyear?
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Re: For those with $500k-$1m in investments...

Post by Whatyear? » Thu May 18, 2017 11:37 am

38% taxable/62% tax-deferred. I max out my 401K and I used to aspire to match that in the taxable (so that the ratio would be 50/50), but like others, I have to tap into the taxable account from time to time.

beammeupscotty
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Re: For those with $500k-$1m in investments...

Post by beammeupscotty » Thu May 18, 2017 11:39 am

33 / 67. Adding to taxable when I can.

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inmymind
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Re: For those with $500k-$1m in investments...

Post by inmymind » Thu May 18, 2017 11:47 am

40 / 60

Mid 30s. Max out tax adv. space and add to taxable when I can.
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Seqfish
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Re: For those with $500k-$1m in investments...

Post by Seqfish » Thu May 18, 2017 11:50 am

45% taxable, primarily due to an inheritance.

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jhfenton
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Re: For those with $500k-$1m in investments...

Post by jhfenton » Thu May 18, 2017 11:51 am

We're 47. Not counting checking and savings accounts, our "retirement portfolio" is 1.7% taxable, 25.7% Roth IRA, 66.6% traditional IRA/401(k), 5.9% HSA. By the time we max out Roths and 401(k)s and family HSA, we're saving a third of our gross income. Any additional savings gets split between taxable and mortgage prepayments. (We have no other debt.)

We have small 529 accounts for both of our kids too, but they are not included in the above.

MathWizard
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Re: For those with $500k-$1m in investments...

Post by MathWizard » Thu May 18, 2017 11:53 am

1.5% in taxable. First Tier EF.

Tamalak
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Re: For those with $500k-$1m in investments...

Post by Tamalak » Thu May 18, 2017 11:56 am

67 taxable / 33 advantaged, mainly due to starting late and having a large initial balance to invest.

Expro
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Re: For those with $500k-$1m in investments...

Post by Expro » Thu May 18, 2017 11:56 am

70% Taxable/30% Tax advantaged. I'm young-ish retired but wife continues to work. We are magi-ed out of everything but her 401k and have been for years.

Admiral
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Re: For those with $500k-$1m in investments...

Post by Admiral » Thu May 18, 2017 11:57 am

OP here.

Thanks to all who replied, I'm sure more will come in.

In case you're curious why I posed this, I am 15% taxable 85% tax advantaged, with all tax-advantaged space maxed out (47k/year). As the responses came in I felt like I was the outlier (much heavier than average in taxable) but it does seem like many people have as large a percentage as I do (or larger). At one point I was well over 20% in taxable but did some back-door Roth conversions to pare it back. Much of this is from monies I earned many years ago.

For no specific reason (except perhaps anal-retentiveness) I like to keep my taxable account at 90-100k. I do sometimes wonder why I bother keeping this much in a taxable account, period (though it does not generate high levels of tax) since I have no specific future use for it in mind... except perhaps as a big EF, or to use to fund an early retirement so I don't have to draw from Roth. I could convert 11k per year into Roth but have only done that a few times.

I do draw from it occasionally and get a little nervous when I take, say, 5% out for a vacation or something home-related, and I try to put the money back in. Probably needless worry since our net worth is about $1m.

DA200
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Re: For those with $500k-$1m in investments...

Post by DA200 » Thu May 18, 2017 11:58 am

50/49 , 3.2M, 55% taxable / 43% tax deferred and 2% tax free
Max out tax deferred, save remaining in taxable.

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djpeteski
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Re: For those with $500k-$1m in investments...

Post by djpeteski » Thu May 18, 2017 12:02 pm

Its funny, a good portion of my net worth derives from real estate, which are obviously not "investable assets". So I barely qualify for this one (we wouldn't have in February):

Age:50
Investable assets: 550K
Breakdown:
Taxable: 13%
Tax Advantaged 87%

I cannot say that this was a very deliberate decision. We max our tax advantaged savings, and we have spending and savings goals with our disposable income. Some months (where we save more) our taxable accounts will out pace our tax advantaged savings, but that won't be true for the next two months. Aruba in June, Cruise in July. :sharebeer

mak1277
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Re: For those with $500k-$1m in investments...

Post by mak1277 » Thu May 18, 2017 12:03 pm

age: 40

taxable - 67%
tax-deferred - 33%

Didn't really save much in 401k until I hit age 30. More recently, due to high compensation, we've been maxing out 401k but still saving far far more each year in taxable. I consider this a good problem to have and don't regret my late start into tax deferred savings.

BHUser27
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Re: For those with $500k-$1m in investments...

Post by BHUser27 » Thu May 18, 2017 12:11 pm

Age 54
$900k
52% taxable
48% advantaged (401k, Roth-IRA, HSA)
Max'd out advantaged accounts most of my career
Mid 6-figure bonus hit taxable ~5 yrs ago

livesoft
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Re: For those with $500k-$1m in investments...

Post by livesoft » Thu May 18, 2017 12:21 pm

We've always had about half our investable (liquid) assets split about 50:50 between taxable and tax-advantaged. That goes for when we had $50K, $100K, $500K, whatever. The reason is that in the old days, contribution limit to 403(b), 401(b), IRAs was limited to much less than it is now, so we always contributed each year about the same dollar amount to taxable as we did to tax-advantaged.

But nowadays, we are no longer contributing to taxable, but are withdrawing from it. Nevertheless, we still contribute to tax-advantaged, so the ratio is get to be more to tax-advantaged.

So I'm not sure what this all means to this thread. I'd expect answers to be throughout the possible range and that's what people report.
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PedsDoc
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Re: For those with $500k-$1m in investments...

Post by PedsDoc » Thu May 18, 2017 12:34 pm

Age: both 46
Total of $942K
1% HSA
8% taxable
17% Roth
74% tax deferred 401k

Once our house is paid off in 3 years we hope to put a lot more in taxable and not use our HSA for current health expenses. With 2 in college that we are cash flowing we can only max the HSA, Roth and 401k. Nothing left to put in taxable for now until college expenses or house is done.

IlliniDave
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Re: For those with $500k-$1m in investments...

Post by IlliniDave » Thu May 18, 2017 12:41 pm

Right now (age 53) I'm about 17% taxable/83% retirement. I bucketed my HSA with the retirement money because of tax treatment. I add to taxable investments biweekly, more than 60% of my take home pay (take home =salary minus taxes, various payroll deductions for insurance and such, 401k contributions, and HSA contribution). I'm on my final sprint to ER in 743 days. I anticipate that I'll have about 30% in taxable/70% in retirement accounts when I bail.
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JohnFiscal
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Re: For those with $500k-$1m in investments...

Post by JohnFiscal » Thu May 18, 2017 12:43 pm

age: 65 (retire in 1 year)

taxable: 24%
Roth: 6.4%
IRA: 68%
401K: 1.6% (post 59-half I have moved this into IRA as in-service rollover for more control and less cost)

I am a bit North of your $1m top end

aristotelian
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Re: For those with $500k-$1m in investments...

Post by aristotelian » Thu May 18, 2017 12:47 pm

Back of the napkin, 40% taxable, 40% his and her Roth IRA, 20% 403b. (But 403b is getting the most contributions). Total $800K.

Exodus
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Re: For those with $500k-$1m in investments...

Post by Exodus » Thu May 18, 2017 12:49 pm

Age: 27

6% Taxable, this is when I thought I could be a day trader. Boy was I wrong.

-B
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new2bogle
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Re: For those with $500k-$1m in investments...

Post by new2bogle » Thu May 18, 2017 12:50 pm

20% in a taxable account. We max out all available tax-advantage spaces that we can get.

I add to my taxable account all the time because there is nowhere else the money can go. I'll probably setup a 529 soon though.
Last edited by new2bogle on Thu May 18, 2017 12:51 pm, edited 1 time in total.

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celia
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Re: For those with $500k-$1m in investments...

Post by celia » Thu May 18, 2017 12:50 pm

25% taxable, about 20% is inheritance from 12 years ago; has been invested aggressively for our heirs
5% tax-deferred
70% Roth
We are converting aggressively and paying the taxes from our pensions and spousal SS before we both max it out at 70.
A dollar in Roth is worth more than a dollar in a taxable account. A dollar in taxable is worth more than a dollar in a tax-deferred account.

KlangFool
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Re: For those with $500k-$1m in investments...

Post by KlangFool » Thu May 18, 2017 1:00 pm

OP,

Age: 50+

Tax Deferred (401K / Rollover IRA) - 45%
Taxable - 45%
Roth IRA - 10%

KlangFool

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catdude
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Re: For those with $500k-$1m in investments...

Post by catdude » Thu May 18, 2017 1:15 pm

Age 61, been retired for 6 years... 18% of portfolio is in taxable, 82% in tax-advantaged...
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sreynard
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Re: For those with $500k-$1m in investments...

Post by sreynard » Thu May 18, 2017 1:27 pm

0.05% Taxable

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elgob.bogle
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Re: For those with $500k-$1m in investments...

Post by elgob.bogle » Thu May 18, 2017 1:30 pm

4% Taxable, 34% in 401k/403b, 62% in ROTH I'm 69 & DW is 62

elgob

onmyway33
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Re: For those with $500k-$1m in investments...

Post by onmyway33 » Thu May 18, 2017 1:32 pm

I am at 40% taxable and 60% tax-advantaged. I just started maxing out my tax advantaged retirement space in the last few years and before that was just making minimal tax-advantaged contributions to a 403b, no IRA contributions, and was dumping the majority of my monthly excess into taxable American Funds with high front-end loads :oops: . In my pre-boglehead days I thought that I didn't want to lock up too much money into a "old age retirement fund" and thought that there was tremendous value in the flexibility of taxable investments :oops: :oops: .
We are currently using our distributions from taxable assets to help cover living expenses and max out IRA space while I continue to max out 401k space with earned income. I also consider taxable assets as a second tier emergency fund and am using taxable distributions to make accelerated payments on our mortgage. This helps me SWAN and justify a fairly risky AA.

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Sheepdog
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Re: For those with $500k-$1m in investments...

Post by Sheepdog » Thu May 18, 2017 1:37 pm

I don't fit the rest of you because of my age, but here it is.
Long time in retirement....my age 83....living off of investments for 18 1/2 years.

Present $975k investments:
Traditional IRAs..............30.9%
Roth IRAs ....................,33.9%
I Bonds.........................19.5%
CDs, cash, taxable bond..... 6.7%
S.P. annuities pres. value... 9.0%

Since I don't have much taxable I seldom have to pay any federal income tax.
People should not say everything they think. They should think about everything they say.

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vitaflo
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Re: For those with $500k-$1m in investments...

Post by vitaflo » Thu May 18, 2017 1:39 pm

50/50. However I have >$1m in investments.

I add to taxable after I max out tax-advantaged. So far, about the same amount goes into both every month.

Briscoe
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Re: For those with $500k-$1m in investments...

Post by Briscoe » Thu May 18, 2017 1:55 pm

Age: 46
Liquid: 840k

58% - 401k
28% - Taxable
14% - RIRA, TIRA, HSA

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