According to the Vanguard “Advisor’s Alpha” study, asset location can add up to 60 bps in returns on an annual basis! The larger your taxable brokerage account balance, the more you need to pay attention to what investments you own in that bucket!
Conventional wisdom says that the taxable accounts should be tapped into first, and therefore should be the most conservative. However, the result could leave you paying more in taxes than you need to!
This is where proper Asset Location comes into the picture.
I hope you enjoy this episode and make sure to share this with someone else like you!
If you are interested in working with me 1×1, make sure to visit my website:
https://imaginefinancialsecurity.com/
-Kevin
Sources:
– Vanguard’s Advisor’s Alpha – Schwab article on after-tax returns – American Century average etf and mutual fund distributions
– Kitces article on the benefits of asset location
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This is for general education purposes only and should not be considered as tax, legal, or investment advice.
