TLH all funds - Lack of options

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Topic Author
Streptococcus
Posts: 377
Joined: Thu Jan 03, 2013 12:17 am

TLH all funds - Lack of options

Post by Streptococcus » Tue Mar 17, 2020 12:20 pm

So yesterday, as I was TLH, I sold most of my funds. I have a 3 fund portfolio.
I sold VTIAX and VFWAX which are my 2 international funds, and VTSAX, my domestic fund. I did no sell VLCAX, my other domestic fund but plan on selling the losing shares of it today.
I tax lost harvest using the specific identification method.

Here’s the issue: I dont want to wait 31 days to get back in. If I wanted to get back in today or tomorrow, what fund options do you recommend? I have vanguard total world (VTWAX) as an option but I’m not sure if it is okay. Plus I might prefer separating them.

Thanks for your suggestions

MotoTrojan
Posts: 9952
Joined: Wed Feb 01, 2017 8:39 pm

Re: TLH all funds - Lack of options

Post by MotoTrojan » Tue Mar 17, 2020 12:22 pm

It isn't really a TLH unless you exchange right in to a similar fund to maintain your exposure.

VTIAX & VFWAX are decent partners but you sold both; VTMGX would be an okay substitute (better than staying out of the market) and maybe you can harvest that back to VTIAX in 30 days.

VTSAX and VLCAX can both be harvested in to VFIAX so I would suggest you exchange your VLCAX into VFIAX at today's close while also buying VFIAX with the proceeds from your VTSAX sale.

stan1
Posts: 8533
Joined: Mon Oct 08, 2007 4:35 pm

Re: TLH all funds - Lack of options

Post by stan1 » Tue Mar 17, 2020 12:25 pm

Use ETFs if you want more choices and no frequent trading restrictions.

Domestic:
VTI, SCHB, ITOT, VOO, SPY, IVV, etc. (many)

International:
VXUS, IXUS, VEU, and VEA/VWO

DSInvestor
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Joined: Sat Oct 04, 2008 11:42 am

Re: TLH all funds - Lack of options

Post by DSInvestor » Tue Mar 17, 2020 12:26 pm

Vanguard Total World VTWAX could be used to replace Total Stock and your international funds. If the allocation of Total World is not to your liking, consider the following:

500 Index VFIAX to replace Total Stock.

A mix of Developed Market Index VTMGX and Emerging Markets Index VEMAX to replace Total International VTIAX and FTSE all world VFWAX.
Wiki

Topic Author
Streptococcus
Posts: 377
Joined: Thu Jan 03, 2013 12:17 am

Re: TLH all funds - Lack of options

Post by Streptococcus » Tue Mar 17, 2020 1:09 pm

stan1 wrote:
Tue Mar 17, 2020 12:25 pm
Use ETFs if you want more choices and no frequent trading restrictions.

Domestic:
VTI, SCHB, ITOT, VOO, SPY, IVV, etc. (many)

International:
VXUS, IXUS, VEU, and VEA/VWO
Can I sell VTIAX, VFWAX and VTSAX and replaced them with VTI and VXUS the same day?

lakpr
Posts: 5395
Joined: Fri Mar 18, 2011 9:59 am

Re: TLH all funds - Lack of options

Post by lakpr » Tue Mar 17, 2020 1:13 pm

Streptococcus wrote:
Tue Mar 17, 2020 1:09 pm
Can I sell VTIAX, VFWAX and VTSAX and replaced them with VTI and VXUS the same day?
VTIAX and VXUS are two different share classes of the same underlying fund.
VTSAX and VTI are two different share classes of the same underlying fund, again similarly.

So, no, you can't do what you propose.

Best option for you appears to be to sell all, and buy a Target Retirement Fund 2055 or 2060, that has a 90:10 allocation to stocks and bonds; the returns between a 90:10 portfolio and 100:0 portfolio are not that different, and it would let you effectively tax-loss-harvest as no one in their right mind would be arguing that a target-date fund is "substantially identical" to either VTSAX or VFWAX or VTIAX.

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