Personal Investments • Asset Allocation Without Tax Consequences?

I generally don't have this issue because virtually all of my money is in tax deferred, but if I had taxable, I would do the following:

1. If you have tax deferred, rebalance there. Say you have a 401K, change some of the stock into bonds. You should see your all of your account as one portfolio.
2. Invest all new money into the allocation you want to switch to. In your example, you want to invest more into bonds, so invest new month into bond until your allocation is reached.
3. Instead of reinvesting your dividend and distribution from your stock fund into the bond.
4. You can also choose to rebalance if your tax bracket is low.

You do not need to rebalance too often. In fact, you should not rebalance too often. Just when you need to and you can just do it slowly.

Statistics: Posted by gavinsiu — Tue Apr 09, 2024 2:46 pm — Replies 3 — Views 161

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