Tax loss harvesting

Fund partners #

• Recommendations from the web:
  • Betterment.
  • Schwab.
  • Wealthfront.
  • Bogleheads wiki.
• International total stock market: VTIAX/VXUS, VFWAX/VEU and IXUS.
  • The former two are a perfect pair. Almost feels like they were made to be TLHed!
• US total stock market: VTSAX/VTI, SCHB and ITOT.

Mutual fund vs ETFs #

• Mutual funds:
  • TLH only makes sense within Vanguard because other funds distribute capital gains, so not tax efficient.
  • Only need one “exchange” transaction with Vanguard. Check if Schwab allows something similar with ETFs though. - Schwab doesn’t allow exchanges but does allow 1 trade with unsettled funds.
• ETFs:
  • I can do everything in one place, i.e. my Schwab account. (Mutual funds, on the other hand, aren’t all available for free on one broker.)
  • I can put limit sell orders. This alone might be the biggest reason to go this way because it won’t require me to track prices closely. Also, alerts.

Resources #

• https://www.bogleheads.org/forum/viewtopic.php?t=296553 - best clarification on strategy and how to handle the before part of wash sale rule.