Breakfastinbed, the main reason why I avoid putting funds (or ETFs) that pay substantial dividends in my taxable account is the tax inefficiency: dividends are taxed at a higher rate than capital gains. This might not make much of a difference initially when balances are small, but cleaning it up later can lead to an even bigger taxable event.2) The general recommendation is to avoid auto-dividends in a taxable account to make tax loss harvesting simpler, and also to have greater control over your rebalancing. You don't HAVE to do this, it depends on your style. For me, I have 6 holdings in taxable, and invest once a month, typically buying 1-2 of them - any dividends are rolled in with my bank transfer.
Statistics: Posted by DIYtrixie — Sun Nov 17, 2024 1:18 am — Replies 2 — Views 273