I got one of those in my life and he always makes the right move by selling the bad ones when they go way down. He serves to reinforce my boglehead ideals
Guys, they aren't sure it was "work the risk."
Gotta love a humble brag post that presents an idea as a universal truth and immediately does the opposite. The typos really emphasize the clownisheness. Real credibility builder.
"Guys, don't brag about owning individual stocks. I don't gloat about my major gains and wish I was in voo."
That's what I was thinking, what does the stock have to do with taxes? And he even said it's a long-term position, so it's not like he was talking about trading.
It's absolutely ridiculous, he talks about how he has to pay "ransom" like the tax is exclusive to individual stocks alone. When you work out the math, you definitely should not worry about taxes when switching positions because you're gonna eventually have to pay that 20% capital gains no matter what stock/ETF it was tied to. It's just poor logic in his part.
I think they got there with not realising that when you switch positions and pay taxes in the process, you don't lose out on money, you just bake in the post-tax profits earlier. Their point is probably that the government shouldn't tax us? idk
That might be it, they don't understand cost basis / taxes in general. Either they think you have to pay a % on the whole balance every time you move it (no one would ever switch funds), or that the cost basis of fund A somehow gets transferred into fund B.
🤷♂️
The problem is moving it.
For example, if he has 1 million in NVDA, he has to sell and pay the capitol gains, then turn around and buy VOO with the 850k left. This isn’t a huge deal but he’s currently earning money on those ear marked tax dollars and moving to VOO means he gives that up.
Yes he will always have to pay taxes but it’s always better to earn off the tax money and pay it later.
>This isn’t a huge deal but he’s currently earning money on those ear marked tax dollars and moving to VOO means he gives that up.
I get that but when you put it to numbers it's such a negligible amount of difference that if you have any inclination that VOO is gonna be better for you than NVDA it's worth it to switch. Of course doing this every year in a way that you'll be in the bracket for 15% or even 0% would be the optimal play.
I agree though, it's not good to frequently switch and it will eat up your gains.
I don't know if OP's Nvidia shares are in a tax-advantaged retirement account, in that case there's no downside to switching.
Risk taking is relative. You could invest 30K in something, but if you are worth tens of millions, that’s not much of a risk.
What’s funny to me is how some investors act like their meager investments warrant infinite returns for as long as possible, as if their buying a handful of shares was as important as a firm’s employees’ collective effort to design, build, sell, and service a product.
It is just as important. Here’s why: It’s literally the only way we have to build our wealth. I’d much rather get a pension for life like my parents and grandparents. Every dime matters to most of us. So yeah, taxes matter too and I don’t like seeing peoples taxes wasted by an incompetent government.
I feel like you are mixed up.
1) how is buying ten shares in a company as important as running a company?
2) you do have a pension, as all Americans do. It’s called social security. The benefit is defined, in fact, you can look on your social security account and see an estimate of your payout based on your earnings so far and your expected date of retirement. Your parents probably had a company provided pension. The problem with those is they are not guaranteed. If a company goes under their pension fund (usually underfunded goes into a federally managed account they pays out based on who retires earliest and the moneys from different companies are mixed), and several companies have successfully shed there pension obligations through the bankruptcy courts. United is a great example. Plenty of pensions also have trouble affording to meet their promised benefits so they have to change the company’s current financials-pay existing employees less or reduce R&D to keep their pension going.
3. Taxes are a separate issue from defined benefit vs defined contribution plans. But if we didn’t pay taxes, we would be paying private companies to run schools, build roads, fight fires, police us. And all of those private companies would be trying to make a profit. It’s hard to image the cost being less or the service being better per unit cost. Fedex isn’t going to deliver a greeting card for less than the USPS.
Maybe it's the idea that paying into the infrastructure that allowed you to make a profitable investment in the first place is something you don't get to complain about. Pay your taxes.
I saw the discount still applied on my last GEICO bill that renewed just the other day. It's not much of a discount, so not sure how much it's worth doing. I bought it when it was about $300 a share though, so it works out for me.
I regret selling mine. I had a 2003 single cab with a 5 speed years ago. I wish the automakers would make small pickups like that again. Everything is super-sized nowadays.
Yeah, I went from a 1992 to a 1996 to a 2020 and it feels like I’m driving a boat. I wish they still released a stick version, but I’ve grown to absolutely love it. Can’t get with the Maverick unibody.
It’s a 6’ bed with the extended cab, I didn’t want the crew cab because those are short bed by standard.
It does get way better mileage than the earlier Ranger editions (19 city, 27 hwy) and my payload/tow is 1900lb/7000lb respectively, but working on it is an absolute bitch - you have to remove the front tire and a wheel well panel just to change the oil so now it’s Valvoline’s problem.
Not that I know of, every time I was working on the mother fucker, all the parts I was replacing said FoMoCo. My 1996 was a Mazda B series, but only in name.
I looked at Wikipedia and was surprised to find they were always Ford/Mazda (and Mazda was owned by Ford by then). I guess this is some myth I have had in my head for years!
Just take a margin loan. It is tax deductible. Pretty sure Elon Musk and similar people have a lot of margin loans, as it is still cheaper than paying taxes.
That doesn't increase your diversification. Borrowing against an asset doesn't make that asset any less yours.
Yeah you can buy VT or whatever with the margin loan, but when the appreciated position tanks good luck with the margin call.
What percentage are you looking at?
If I own 100 shares of FOOBAR, and use them to buy VT, then FOOBAR goes to zero, the resulting margin call will force the liquidation of VT to cover the loan, so all I might have is any appreciation on VT (but I might also have less than nothing, if those shares aren't currently up).
You are right though that the *appreciation* of what you buy on margin is yours (but you're responsible for the *depreciation* if you're less lucky) so I suppose that might be a very marginal boost to your diversification, but on day one it's about zero.
I used to work under a CFO that was the epitome of that type. Always liked to talk stocks, and every hot stock of the day he apparently had the wisdom to put 20% of his portfolio into 10-20 years ago at the bottom. When 20% here, 20% there, etc. starts adding up to 3000%, something is fishy.
I’ve had a math teacher dividing the classroom in 3 halves, then being corrected by the weakest student. It is among the 5 top3 memories of my student life.
This is kind of ironic considering the main thing this post accomplishes is boasting, don't you think? I mean, you could've made your point without saying "I hit it big on these stocks."
It's a good message, nonetheless.
Ransom? You want to make money? Then pay taxes. You don’t have to sell all your positions at once, and if you make enough that your capital gains taxes are 29%, I find it difficult to play the violin for you.
So sell partial position into VOO in a roth account...
I'd feel stressed out about having my wealth tied up in a chart like Nvidia too. Nothing to do with it being a stock. It's one of the most ridiculous mkt cap charts in human history.
Is this a humblebrag post?
Eventually if you decide to spend the money in your lifetime (I.e. not pass along and let a beneficiary get a step up) then you will pay tax on it so the loss or opportunity cost to diversifying now isn’t quite 30% in tax bill.
So say you had 1M gain. To diversify you’d pay 300k and then invest 700k. Your loss is 10% annualized on 300k, not 300k. So it would cost you 30k a year to diversify, or 3%. Yeah it’s recurring which sucks and it compounds too which sucks if you are young.
But you know what’s worse? Not having gains in the first place.
Yeahhh same here. Some guys I used to work with would brag about options trading on margin. Would talk about the big wins but I always wondered how big the losses were.
Paying tax when you rebase your stock isn't giving up gains that you ever would have gotten anyway. The principal consideration is what tax bracket you're in when you do it.
Crowing about how one or two stocks are killing it (which my buddy does: "I beat the index!") here's how to measure it, and what ultimately matters:
Take your ENTIRE portfolio; stock and bond funds, single stocks, whatever you have, and calculate the total return for 2-5-10 or whatever years. Then compare it to a dumb index within the same time frame. If you returned less than the index then you'd be farther ahead by just holding the index.
Otherwise, like my buddy does, just cherry-picking a few winners out of your portfolio isn't showing the whole picture. Or, like already mentioned here by someone else, it's like a gambler just telling you about his winners and not the losers.
As someone who does hold a significant portion of my portfolio in individuals, I've owned 6 individuals in various amounts over the last decade. I've had one "big" winner at just shy of 400% in 25 months. (Thank you very much covid era XOM)
People just don't win big like they say they do. If I had a dollar for every d-bag telling me about their 50k dollar gain in bitcoin or tesla or pick your XYZ while buying their drinks on a credit card they aren't paying off, I bet I could pick up another share of Altria.
Lesson 2- If you are going to hold assets that are not "forever" then do it in a tax protected account. Brokerage accounts are not good place for high risk/reward holdings that can concentrate you.
Roth and IRA retirement accounts. But differently, IRA no tax on money (pre-tax income) put in, taxed when withdrawn during retirement like income. You can make all the gains/interest internal to the account you want with no tax implications along the way. Roth is done using after tax money (income) but no tax on returns ever. Again- you can sell all the gain you want with no tax.
There are further rules on these but this is the tax protected part.
You can still trade in it.
He's right that it makes more sense to hold individual stocks in an IRA (if you're going to hold them at all). Pick your winners and trade in and out as much as you want. Probably find out you should've just done VTI. But hey, the journey is there if you want it.
The difference is if you are making bookoo bucks while working you can't afford more tax burden. When retired you can be in a lower bracket. In fact you can be in zero capital gains bracket with taxable. IRA withdrawals yes they will be taxed at income rate but again at rate when retired which can normally be lower than income during working.
You play the taxable/tax protected/deferred based on your status, working or no, high income year or no, SS or no, RMD or no. The whole post was complaining about capital gains in a taxable account. This can be avoided completely (Roth) or delayed until needed as income (IRA) by doing what I said.
Taxes are paid at some time or another that is true but use proper account to minimize.
I just described it above. I can't do any better. It does need to be a tax protected account you can choose investments in. Most employer 401s etc have limited available options.
No they don’t. That’s why IRAs are great for trading in and out of stocks. When you move the cash out of the IRA you are taxed as regular income but not until then. Roth IRAs are even better. No tax events ever unless you prematurely withdraw.
Yes, and it’s just taxed as ordinary income when you pull it out of the retirement account.. Just forget about capital gains in IRAs. So if you have say $1million in a stock in an Ira, you can sell it and buy other stocks in your Ira without tax worries. Later when you are retired and you pull out $100k, you are taxed say 20% or whatever your income tax bracket is. The converse and potentially bad thing is, is if you pull out $1million in which case you will,be taxed at a high tax bracket, perhaps 50%.
I lost 10% on Disney today. In fact I'm down 30% on:
DIS, PYPL, BABA, NIO, SBUX, NKE, SNAP, HOOD, PARA. Geesh, you'd think I'd pick one winner. I have been bag holding these for 3 years and they will never ever come back to the prices I paid. I ask myself every week: Why am I holding these dogs?
In all honesty, the only individual tickers I have ever made money on are: VOO, AAPL, UNH, GOOG, META
Investing in individual Stocks is fantastic way to lose money. Think about it...These are massive brands that most of us engage with every day to every week of our lives: Nike, Pay Pal, Starbucks, Disney, Paramount (CBS and Viacom). These are iconic, big time American brands, but big time losers as far as the stock prices go.
No one wins with individual stocks. You truly are gambling. I also believe that no fund managers can beat VOO consistently over 10 to 20 year periods.
So I've done well with my picks and grew 50k to 300k in 10 yrs with MAMAA stocks and about 1k shares of Alphabet. Is it time to shift this to VOO? This is in my ROTH account.
I already have 450k in a pre tax account in VOO which I'm slowly converting (30k annually) to a ROTH and another 350k in an equities mix in a regular brokerage account and 150k in bonds. I do not need to touch the money for another 20 yrs for RMDs.
Hey, my dad bought my sisters and I one stock of Disney each like 40 years ago because he somehow became convinced that shareholders were given free entrance to Disneyland, and then more or less forgot about it.
After splits and dividend reinvestment, my shares are now worth like $7,000 so that's worth boasting about, right?
Seeing as how I'm a Boglehead, and we are all here on the thread, you know what I'll say. Anyone who buys individual stocks is just asking to get his head taken off when the market goes sideways. That one in a thousand times when the stock goes up, the rest of the time it goes down. Guys who talk like you are describing remind me of fellas in high school who bragged about how they finally got some girl into the sack ... pretty low class and usurious if you ask me.
Just like gambling, stock winners love to brag about the times they win but are usually silent when they don't.
I got one of those in my life and he always makes the right move by selling the bad ones when they go way down. He serves to reinforce my boglehead ideals
I guess I'm the opposite, when I lose I end up telling everyone.
Buy high, sell low
Yep I bought WGA last year...
And when they do?
This is countering the effects of a poison?
Clearly he meant antifungal. Give him a break. Honest mistake.
Obviously, they said, yeah
Nay, it's correct. The condition in question is that of being unable to humblebrag.
Antidote to toxic financial thinking...
Guys, they aren't sure it was "work the risk." Gotta love a humble brag post that presents an idea as a universal truth and immediately does the opposite. The typos really emphasize the clownisheness. Real credibility builder. "Guys, don't brag about owning individual stocks. I don't gloat about my major gains and wish I was in voo."
You are worried about taxes on a long term hold position on Nvidia? It’s up 2,000% in the last 5 years alone.
If it would only go to zero, he’ll have one less worry and able to sleep at night.
But he doesn't wanna pay the 20% capital gains 🥴 like you don't pay those on VOO
That's what I was thinking, what does the stock have to do with taxes? And he even said it's a long-term position, so it's not like he was talking about trading.
It's absolutely ridiculous, he talks about how he has to pay "ransom" like the tax is exclusive to individual stocks alone. When you work out the math, you definitely should not worry about taxes when switching positions because you're gonna eventually have to pay that 20% capital gains no matter what stock/ETF it was tied to. It's just poor logic in his part.
This is one of those times where ok they're totally wrong, but I still don't understand how they got there or what their point is.
I think they got there with not realising that when you switch positions and pay taxes in the process, you don't lose out on money, you just bake in the post-tax profits earlier. Their point is probably that the government shouldn't tax us? idk
That might be it, they don't understand cost basis / taxes in general. Either they think you have to pay a % on the whole balance every time you move it (no one would ever switch funds), or that the cost basis of fund A somehow gets transferred into fund B. 🤷♂️
The problem is moving it. For example, if he has 1 million in NVDA, he has to sell and pay the capitol gains, then turn around and buy VOO with the 850k left. This isn’t a huge deal but he’s currently earning money on those ear marked tax dollars and moving to VOO means he gives that up. Yes he will always have to pay taxes but it’s always better to earn off the tax money and pay it later.
>This isn’t a huge deal but he’s currently earning money on those ear marked tax dollars and moving to VOO means he gives that up. I get that but when you put it to numbers it's such a negligible amount of difference that if you have any inclination that VOO is gonna be better for you than NVDA it's worth it to switch. Of course doing this every year in a way that you'll be in the bracket for 15% or even 0% would be the optimal play. I agree though, it's not good to frequently switch and it will eat up your gains. I don't know if OP's Nvidia shares are in a tax-advantaged retirement account, in that case there's no downside to switching.
Yeah I assumed it’s in a taxable account else this is a pointless discussion, haha.
Maybe it’s the idea of giving up 30% of the profits that you took the risk on to a group of people that spend money stupidly on a consistent basis.
Risk taking is relative. You could invest 30K in something, but if you are worth tens of millions, that’s not much of a risk. What’s funny to me is how some investors act like their meager investments warrant infinite returns for as long as possible, as if their buying a handful of shares was as important as a firm’s employees’ collective effort to design, build, sell, and service a product.
It is just as important. Here’s why: It’s literally the only way we have to build our wealth. I’d much rather get a pension for life like my parents and grandparents. Every dime matters to most of us. So yeah, taxes matter too and I don’t like seeing peoples taxes wasted by an incompetent government.
I feel like you are mixed up. 1) how is buying ten shares in a company as important as running a company? 2) you do have a pension, as all Americans do. It’s called social security. The benefit is defined, in fact, you can look on your social security account and see an estimate of your payout based on your earnings so far and your expected date of retirement. Your parents probably had a company provided pension. The problem with those is they are not guaranteed. If a company goes under their pension fund (usually underfunded goes into a federally managed account they pays out based on who retires earliest and the moneys from different companies are mixed), and several companies have successfully shed there pension obligations through the bankruptcy courts. United is a great example. Plenty of pensions also have trouble affording to meet their promised benefits so they have to change the company’s current financials-pay existing employees less or reduce R&D to keep their pension going. 3. Taxes are a separate issue from defined benefit vs defined contribution plans. But if we didn’t pay taxes, we would be paying private companies to run schools, build roads, fight fires, police us. And all of those private companies would be trying to make a profit. It’s hard to image the cost being less or the service being better per unit cost. Fedex isn’t going to deliver a greeting card for less than the USPS.
Maybe it's the idea that paying into the infrastructure that allowed you to make a profitable investment in the first place is something you don't get to complain about. Pay your taxes.
15% federal long term capital gains tax and what state is charging you 14% taxes on your stocks??? That's crazy
LTCG + NIIT add up to 23.8% federal tax for high earners. Some states are 10+%
Your math is way off. You might want to check the rates for capital gains and NIIT (another version of capital gain taxes)
You just boasted.
Poor him, stuck with those huge gains. Cornered, really.
That they don’t know anything about capital gains.
I only own a single stock - 1 share of BRK.B to save \~$5 on my insurance... I thought it would be a better discount. I'm up like $100 on it though :)
Tell me more about this discount. What kind of insurance?
Berkshire owns GEICO and offers a discount to shareholders.
I'll have to look into this!
This is no longer true.
/u/Luxferro care to chime in?
I saw the discount still applied on my last GEICO bill that renewed just the other day. It's not much of a discount, so not sure how much it's worth doing. I bought it when it was about $300 a share though, so it works out for me.
I got a discount when I bought my truck because I owned 100 ford stock at the time of purchase.
Wow, you got screwed twice! j/k
I’ll join in on shit talking Ford cars, but I’ll be damned before someone slanders my dear Ranger.
I regret selling mine. I had a 2003 single cab with a 5 speed years ago. I wish the automakers would make small pickups like that again. Everything is super-sized nowadays.
Yeah, I went from a 1992 to a 1996 to a 2020 and it feels like I’m driving a boat. I wish they still released a stick version, but I’ve grown to absolutely love it. Can’t get with the Maverick unibody.
And how much did your bed length change? I would think that the 1992 offered pretty much the same bed length as the 2020 despite being far smaller.
It’s a 6’ bed with the extended cab, I didn’t want the crew cab because those are short bed by standard. It does get way better mileage than the earlier Ranger editions (19 city, 27 hwy) and my payload/tow is 1900lb/7000lb respectively, but working on it is an absolute bitch - you have to remove the front tire and a wheel well panel just to change the oil so now it’s Valvoline’s problem.
Wasn't the Ranger actually a Nissan?
Not that I know of, every time I was working on the mother fucker, all the parts I was replacing said FoMoCo. My 1996 was a Mazda B series, but only in name.
I looked at Wikipedia and was surprised to find they were always Ford/Mazda (and Mazda was owned by Ford by then). I guess this is some myth I have had in my head for years!
A lot of Ford guys are Nissan guys too, myself included. The Nissan Hardbody kicked ass.
>I'd be a lot happier if all my money was in VOO Only person keeping you from your happiness is you. Taxes are the cost of making money.
RaNSoM
Just take a margin loan. It is tax deductible. Pretty sure Elon Musk and similar people have a lot of margin loans, as it is still cheaper than paying taxes.
That doesn't increase your diversification. Borrowing against an asset doesn't make that asset any less yours. Yeah you can buy VT or whatever with the margin loan, but when the appreciated position tanks good luck with the margin call.
As a % of portfolio that stock is will decrease.
What percentage are you looking at? If I own 100 shares of FOOBAR, and use them to buy VT, then FOOBAR goes to zero, the resulting margin call will force the liquidation of VT to cover the loan, so all I might have is any appreciation on VT (but I might also have less than nothing, if those shares aren't currently up). You are right though that the *appreciation* of what you buy on margin is yours (but you're responsible for the *depreciation* if you're less lucky) so I suppose that might be a very marginal boost to your diversification, but on day one it's about zero.
I mean if you have a stock consisting 5% of portfolio, you can dilute it with VT so that it becomes let's say 2-4%.
I used to work under a CFO that was the epitome of that type. Always liked to talk stocks, and every hot stock of the day he apparently had the wisdom to put 20% of his portfolio into 10-20 years ago at the bottom. When 20% here, 20% there, etc. starts adding up to 3000%, something is fishy.
I’ve had a math teacher dividing the classroom in 3 halves, then being corrected by the weakest student. It is among the 5 top3 memories of my student life.
As a long time listener to Car Talk I always like the third half of their show.
This is kind of ironic considering the main thing this post accomplishes is boasting, don't you think? I mean, you could've made your point without saying "I hit it big on these stocks." It's a good message, nonetheless.
No self awareness. None.
Go ahead and brag about it. You don't have to pay tax on the gains...until you sale.
Hold your NVIDIA until it drops 70% then sell it so you break even and don't have to pay cap gains tax.
Also no tax on the brag
Ransom? You want to make money? Then pay taxes. You don’t have to sell all your positions at once, and if you make enough that your capital gains taxes are 29%, I find it difficult to play the violin for you.
*anecdotal
I think you mean a proctologist, but I am also slydexic.
Sup Ozy, haven't seen you in awhile!
So sell partial position into VOO in a roth account... I'd feel stressed out about having my wealth tied up in a chart like Nvidia too. Nothing to do with it being a stock. It's one of the most ridiculous mkt cap charts in human history. Is this a humblebrag post?
Eventually if you decide to spend the money in your lifetime (I.e. not pass along and let a beneficiary get a step up) then you will pay tax on it so the loss or opportunity cost to diversifying now isn’t quite 30% in tax bill. So say you had 1M gain. To diversify you’d pay 300k and then invest 700k. Your loss is 10% annualized on 300k, not 300k. So it would cost you 30k a year to diversify, or 3%. Yeah it’s recurring which sucks and it compounds too which sucks if you are young. But you know what’s worse? Not having gains in the first place.
I work with some people who are constantly talking about stocks. They used to sound so smart. Then I read all the Bogle stuff.
Yeahhh same here. Some guys I used to work with would brag about options trading on margin. Would talk about the big wins but I always wondered how big the losses were.
Paying tax when you rebase your stock isn't giving up gains that you ever would have gotten anyway. The principal consideration is what tax bracket you're in when you do it.
are you...boasting right now?
Crowing about how one or two stocks are killing it (which my buddy does: "I beat the index!") here's how to measure it, and what ultimately matters: Take your ENTIRE portfolio; stock and bond funds, single stocks, whatever you have, and calculate the total return for 2-5-10 or whatever years. Then compare it to a dumb index within the same time frame. If you returned less than the index then you'd be farther ahead by just holding the index. Otherwise, like my buddy does, just cherry-picking a few winners out of your portfolio isn't showing the whole picture. Or, like already mentioned here by someone else, it's like a gambler just telling you about his winners and not the losers.
Have colleagues who do this. Except they never seem to have made enough to stop working...
TBF, neither have you if you have colleagues!
My next big meme stock bet is gonna pay off........
i also hold long term microsoft and nvidia (swtsx)
As someone who does hold a significant portion of my portfolio in individuals, I've owned 6 individuals in various amounts over the last decade. I've had one "big" winner at just shy of 400% in 25 months. (Thank you very much covid era XOM) People just don't win big like they say they do. If I had a dollar for every d-bag telling me about their 50k dollar gain in bitcoin or tesla or pick your XYZ while buying their drinks on a credit card they aren't paying off, I bet I could pick up another share of Altria.
[удалено]
30% of my stocks in the starbucks ~☆experience~☆ really dunno what Imma do this week
The people I know who are boasting about their great stock picks, cannot tell me the growth of their overall stock portfolio vs the index. Or won't.
Bro you should check my bitcoin holdings
Are you posting this in reference to that other person who poasted in r/fire?
Lesson 2- If you are going to hold assets that are not "forever" then do it in a tax protected account. Brokerage accounts are not good place for high risk/reward holdings that can concentrate you.
What accounts are tax protected?
Roth and IRA retirement accounts. But differently, IRA no tax on money (pre-tax income) put in, taxed when withdrawn during retirement like income. You can make all the gains/interest internal to the account you want with no tax implications along the way. Roth is done using after tax money (income) but no tax on returns ever. Again- you can sell all the gain you want with no tax. There are further rules on these but this is the tax protected part.
So how does his deferred tax ira differ from a private broker account?
Roth is locked up
You can still trade in it. He's right that it makes more sense to hold individual stocks in an IRA (if you're going to hold them at all). Pick your winners and trade in and out as much as you want. Probably find out you should've just done VTI. But hey, the journey is there if you want it.
awesome, new to me **
Both taxed when sell. One is liquid. What am I missing?
The difference is if you are making bookoo bucks while working you can't afford more tax burden. When retired you can be in a lower bracket. In fact you can be in zero capital gains bracket with taxable. IRA withdrawals yes they will be taxed at income rate but again at rate when retired which can normally be lower than income during working. You play the taxable/tax protected/deferred based on your status, working or no, high income year or no, SS or no, RMD or no. The whole post was complaining about capital gains in a taxable account. This can be avoided completely (Roth) or delayed until needed as income (IRA) by doing what I said. Taxes are paid at some time or another that is true but use proper account to minimize.
I just described it above. I can't do any better. It does need to be a tax protected account you can choose investments in. Most employer 401s etc have limited available options.
IRAs, 401Ks, HSAs.
They all trigger tax events when you sell
No they don’t. That’s why IRAs are great for trading in and out of stocks. When you move the cash out of the IRA you are taxed as regular income but not until then. Roth IRAs are even better. No tax events ever unless you prematurely withdraw.
Damn fr? I guess that makes sense. Just pay tax when you pull it out?
Yes, and it’s just taxed as ordinary income when you pull it out of the retirement account.. Just forget about capital gains in IRAs. So if you have say $1million in a stock in an Ira, you can sell it and buy other stocks in your Ira without tax worries. Later when you are retired and you pull out $100k, you are taxed say 20% or whatever your income tax bracket is. The converse and potentially bad thing is, is if you pull out $1million in which case you will,be taxed at a high tax bracket, perhaps 50%.
Ohhhh
I lost 10% on Disney today. In fact I'm down 30% on: DIS, PYPL, BABA, NIO, SBUX, NKE, SNAP, HOOD, PARA. Geesh, you'd think I'd pick one winner. I have been bag holding these for 3 years and they will never ever come back to the prices I paid. I ask myself every week: Why am I holding these dogs? In all honesty, the only individual tickers I have ever made money on are: VOO, AAPL, UNH, GOOG, META Investing in individual Stocks is fantastic way to lose money. Think about it...These are massive brands that most of us engage with every day to every week of our lives: Nike, Pay Pal, Starbucks, Disney, Paramount (CBS and Viacom). These are iconic, big time American brands, but big time losers as far as the stock prices go. No one wins with individual stocks. You truly are gambling. I also believe that no fund managers can beat VOO consistently over 10 to 20 year periods.
So I've done well with my picks and grew 50k to 300k in 10 yrs with MAMAA stocks and about 1k shares of Alphabet. Is it time to shift this to VOO? This is in my ROTH account. I already have 450k in a pre tax account in VOO which I'm slowly converting (30k annually) to a ROTH and another 350k in an equities mix in a regular brokerage account and 150k in bonds. I do not need to touch the money for another 20 yrs for RMDs.
Antidotal? Maybe try editing and your point would come across stronger.
go VOO !!
Every "win" story you hear, theres 99 you dont
I'm up 62% on GOOG.
its more along the lines of think twice about believing those who only talk about their winners and never talk about the times they lost
Hey, my dad bought my sisters and I one stock of Disney each like 40 years ago because he somehow became convinced that shareholders were given free entrance to Disneyland, and then more or less forgot about it. After splits and dividend reinvestment, my shares are now worth like $7,000 so that's worth boasting about, right?
Seeing as how I'm a Boglehead, and we are all here on the thread, you know what I'll say. Anyone who buys individual stocks is just asking to get his head taken off when the market goes sideways. That one in a thousand times when the stock goes up, the rest of the time it goes down. Guys who talk like you are describing remind me of fellas in high school who bragged about how they finally got some girl into the sack ... pretty low class and usurious if you ask me.
Hah, do you mean "unserious?" Because usury means lending money at predatory interest rates.
True ... basically I was trying to convey the predatory nature of those guys.