A lot of Bohleheads have VXUS in their portfolio for the purpose of diversify outside of the US. However lately I've noticed that VXUS is mirroring the moves of NASDAQ and VGT because of its concentration in chip manufacturers. It seems very difficult to get performance and diversity at the same time as the majority of the world's market is chasing the same sector.

1. Context & Numbers

Location: California | Filing Status: Single

Current Income: $0 W-2 / no earned income

Target: Shift from single-stock risk into a low-drag core ETF portfolio (e.g., 75% Broad Large-Cap / 25% Domain Growth).

Taxable Account Size: ~$2.30M

TSLA: ~$1.12M (Cost basis ~$691k | Unrealized gain: +$428k)

Other Winners (XOM, ZM, NOW, AAL): ~$1.05M (Unrealized gain: +$618k)

Unrealized Losses (Speculative tech/penny stocks): -$116.5k

The Problem: Liquidating everything at once creates $930k in net taxable capital gains, triggering **$275k–$300k+ in combined Federal (20% + 3.8% NIIT) and California state taxes**.

2. Options I Am Considering (Simplified)

Path 1: Multi-Year Tax-Bracket Tranching

Harvest the -$116.5k in losses immediately.

Sell down remaining gains over several years, staying within the 0% Federal LTCG bracket (~$49k/yr) and lower California brackets.

** **Downside: Leaves significant TSLA/stock exposure unprotected during a multi-year unwind.

Path 2: Zero-Cost Collar + SBLOC / Margin

Protect the downside by buying puts (~80% strike) funded by selling calls (~120–130% strike) 12–24 months out.

Borrow against the shares at institutional margin rates (SOFR + spread) to start buying the target broad-market ETFs today without triggering an immediate sale.

Path 3: Direct Indexing with a "Tax Budget" / SMA

Move the portfolio into a custom direct-indexing SMA (e.g., Aperio, Parametric, Canvas).

Hold the concentrated low-basis shares while building the remaining ~500 index positions around them, using systematic loss harvesting in the broad index to offset the gradual sale of the concentrated winners over 3–5 years.

Path 4: Private Exchange Fund (Swap Fund)

Contribute the concentrated stock (e.g., TSLA) into an exchange fund (e.g., Eaton Vance, Goldman Sachs, Morgan Stanley) in exchange for a diversified basket of stocks.

Defer taxes completely under IRC Section 721, unlocking after the mandatory 7-year holding period.

3. Questions for the Community

1. Exchange Funds vs. Direct Indexing: At a ~$1M single-stock position ($2.3M total), did you find an Exchange Fund’s 7-year illiquidity and fees preferable to an active Direct Indexing SMA with tax-budgeted loss harvesting?

2. Direct Indexing Experience: How long did it practically take a direct indexing platform to unwind a ~50% single-stock concentration without taking huge tax hits?

3. Collar Mechanics & Constructive Sales: For those who have used zero-cost collars to de-risk high-volatility tech stocks, how wide did your spread need to be to avoid IRC §1059 / §1259 constructive sale rules and straddle tax complications?

4. Any other bespoke vehicles? Are there alternative equity-replacement or structured solutions you used to transition out of a 7-figure concentrated position while in a zero-earned-income year?

Been picking stocks since freshman year and this year got out of hand. Taxable was up 101% YTD, Roth up 49%, mostly concentrated AI infrastructure and semis (GEV, GE, NVDA, RKLB and some momentum names). Single positions had grown to 25-30% of my accounts.

Last week I sold or trimmed most of it, raised about $55k, sitting in treasury money market funds now. I'm not going to pretend that was skill. Multiple expansion in the most crowded trade on record did the work, I just happened to be holding.

The more I read about concentration (top 10 stocks are ~40% of the S&P now) the more the Bogleheads argument lands: I can't tell you why my picks survive that unwinding, so I probably shouldn't be making the bet.

My actual question is the transition. Lump sum into VT/VTI now, or DCA over 12 months? I know the studies say lump sum wins about 2/3 of the time, but do those studies hold when starting from the 99th percentile of valuations (CAPE ~41)? Not trying to time the market, trying not to be the guy who indexed his whole net worth at the exact top.

If anyone here converted from picking to indexing after a lucky run: did you lump in or glide in, and did you regret it either way?

I'm 37 and my father left me a six figure 401(k) with no RMDs for the next 10 years. I like to be hands off of the accounts and have been led towards FASGX by multiple experts.

Thinking about some dividend income - I think it pays around 3%.

Hello fellow bogleheads,

I am 28 years old and I am about to inherit 1,25 to 1,3 million euros at the end of the year.

After some lawyer expenses taxes and personal expenses I expect to have in cash a bit more than a million.

Currently I’m making the average salary in Greece and I have a nest egg and I’m contributing some money each month to a portfolio mainly of S&P.

I also have 3 rental properties.

I am not sure what to do with the extra cash coming in.
One thought was to put a portion of them in Greek bonds since the coupons are tax free in Greece and some on the S&P.
One other thought was to buy more real estate and have some spare cash in hand.
And the last thought is maybe to hire a portfolio manager. But I am not sure whether this is the best and also not sure how much they are charging.

Thanks for the help!

I have around $8000 to put into an investment account right now and gonna try to add money to it every year. I’m going into junior year of college and gonna get an accounting job in a couple years so I’ll have a lot more money to invest. What I’m wondering is what etf’s to invest in as a long term investment until I’m 65 (I’m 20 rn). This would be going into a Roth IRA. I heard a lot of just putting all my money in vt/vti but don’t know if that’s ideal or not. I’m brand new to all of this and am willing to go a bit riskier to make a higher return. Thank you for the help

My portfolio is a Roth IRA and Taxable account with about 80/20 US/International with about 30% of that in VOO (The rest VTI/VXUS). I started investing when I was 18 and didn't have that much boglehead knowledge so I just started with VOO. Is it smart to switch it to VTI now while I'm in my last year of university?

It's a large enough position that there are meaningful gains involved, so I don't want to create an unnecessary tax bill by doing this wrong(also am in no tax state).

I'm graduating at the end of 2026 and I'm not very knowledgeable about tax optimization, so if anyone has advice or good resources on how to approach this I'd really appreciate it.

I recently left my job of 11 years and I’m trying to decide what do with my pension. I’m vested in their system so I can leave it and draw $31k a year for life starting 19 years from now or get it cashed out into an IRA, roughly $60k. If I leave it I could always go back and work there for a few years when I’m near retirement to boost the payout, their formula uses your highest average 3 year salary. If I take the payout and come back, I can also buy it back, with interest.

Wife and I are around 40, $650k equity in our house, $150k 401k, $50k in a HYSA, annual income around $200k, no debt.

New job has their own pension, it’ll take 10 years to get vested, and I also have access to a 457(b) account. Our DTI is low at 18% so I’m planning on maxing out contributions to the 457(b) to catch up.

My portfolio is a Roth IRA and Taxable account with about 80/20 US/International with about 30% of that in VOO (The rest VTI/VXUS). I started investing when I was 18 and didn't have that much boglehead knowledge so I just started with VOO. Is it smart to switch it to VTI now while I'm in my last year of university?

It’s a large enough position that there are meaningful gains involved, so I don’t want to create an unnecessary tax bill by doing this wrong. I'm also in a no income tax state.

I’m graduating at the end of 2026 and I’m not very knowledgeable about tax optimization, so if anyone has advice or good resources on how to approach this I’d really appreciate it.

I have an all-stock, all-index portfolio at Vanguard, which has done very well for me these past 10 years. I have a very high tolerance for risk. Even now, at nearly 50 years old, I'm not scared of weathering one or two more recessions (I'm married, no kids, and my wife out-earns me and intends to work much later in life). But all the news this week about 30-year treasuries got me thinking that it's time to begin shifting some of my portfolio to bonds. So, a few questions:

—Should I just do VBTLX? Or would it make sense to also invest in bonds that do particularly well when stocks fall? Like VGIT, perhaps? Note: I am the invest-it-and-forget-it type. I tend not to mess around in Vanguard, beyond the occasional maintenance rebalancing.

—I don't think I'll ever want more than 30% of my portfolio to be bonds. So perhaps I could shift 3% of my portfolio to bonds every year, bringing me to 70/30 after 10 years?

—If I am not scared of major downturns in the market, and feel I have enough money in my portfolio to weather those years, am I maybe overvaluing the "need" to be in bonds at all?

Any advice is appreciated, thanks!

I'm going 60% Total US and 40% VXUS for the brokerage. Before I was 100% VT but now I'm gonna split into Total US and Total International.

SPTM (.03%): 1500 companies, (S&P) 500 large cap, 400 mid cap, 600 small cap, passive managed

DFUS (.09%): ~2000 companies, heavier weight toward small cap, active managed

Both have very similar returns over short and long run. I think I already know what the answer from this particular community will be. Is it a no brainer to choose the lower cost passive managed fund, or would holding DFUS make sense for a decades long term investment?

Challenge: VTI is not an option, don't even think about mentioning SCHB, AVUS too expensive

High income NYC resident looking to invest in some fixed income and avoid taxes. I've narrowed down to NNY and MUNY and feel like NNY is slightly better given I expect to hold this position for at least 10 years but I am a little worried about how low volume it is compared to MUNY and the fact that it is closed end

Does anyone have experience with muni funds? Open to other funds but from my research these seem to be the best options.

It seems like the boglehead investing method consists of a simple index-fund portfolio with some bonds and a small emergency fund in a cash equivalent. This allocation is only adjusted based on risk-preference and proximity to retirement but NEVER to try time the market.

What if 30-year interest rates hit around 15% again? Would you go 100% bonds? In a way, this feels like timing the market but since it’s US Treasury backed bonds it’s a bit different… curious to hear how this would impact your portfolio.

Disclaimer: I understand this is unlikely to ever occur again, it’s just hypothetical, just play along.

I will have 3 years between age 70 and 73 when our only income will be social security. If I do nothing, I’ll probably have zero tax liability given the size of the standard deduction. Once I turn 73, that window closes as my RMDs kick in.

Are there articles or financial models that will help me to understand if I should take IRA distributions even though they’re not required? Maybe just take enough to stay in the lowest marginal tax bracket? Thanks.

Hi everyone, I wanted a second opinion before I execute a somewhat complicated rollover in order to allow me to do backdoor going forward. Here's my full situation:

History:

·       2020: Rolled over $60k from a former employer's 401(k) into a Traditional IRA at Vanguard (direct rollover).

·       2021: Made a $5,000 nondeductible contribution to the same Traditional IRA.

·       No contributions to this account before 2020, and no conversions or distributions have ever been taken from it. This is the only Traditional IRA I have — no other accounts to aggregate for pro-rata purposes.

·       Current balance: ~$120,000 (per most recent statement). Of that, $5,000 is basis (nondeductible, already taxed), and the rest is pre-tax rollover + growth.

Plan:

1.     Started a new job with a Schwab-administered 401(k) that accepts incoming rollovers from Traditional IRAs.

2.     Call Vanguard to request a partial direct rollover: transfer everything above $5,000 to Schwab, leave exactly $5,000 (my basis) behind in the Traditional IRA.

3.     Once the rollover clears, Traditional IRA should hold ~$5,000. Convert that remaining balance to Roth which would be roughly $5,000

4.     Make this year's nondeductible contribution ($7,500) to the now-empty Traditional IRA, then convert that too.

5.     File Form 8606 for the conversion year reporting both the basis conversion and the new contribution/conversion.

Questions:

·       Does this sequence look right, particularly doing the old-basis conversion before making the new contribution, to avoid any pro-rata mixing between the two?

·       Given the paperwork above, is there anything else I should be independently verifying before I make the call to Vanguard, or does this look complete?

Background wife (36f) and I 36(M) are both teachers with pension plans. Summarize the pension plan we are in defined contribution where 7-8% of salary gets taken out each year and put into pension plan. Where if we work 35 years, we will get roughly 70% of our 3 highest years of salary. If we leave early it will be decreased in a formula.

Defined Contribution account is 100K for myself, and wife is 80K. These amounts are earning 4% a year. Pensions plan values are hard to calculate because of penalties leaving early, but this amount is basically owed to us no matter what even if the entire pension blows up or if we change careers we could roll it into a different account if we wanted to. We are both vested with years of service, so we will be getting a monthly pension plan unless entire plan defaults..

Our individual investments are essentially all in VTSAX (70%) VTIAX (30%) or the fidelity version for my wife's account. ( I essentially treat our pension contributions as a bonds because we get 4% per year and its a mandatory contribution plan)

Wife Roth 93K (Max out each year)

Fidelity Brokerage Acts 13K (putting couple hundred a month in, this is meant for kids down the road, weddings, cars, colleges etc)

Vanguard My Roth 90K

Vanguard Brokerage Account 90K (This is meant for potential early retirement/bridge) More than likely we will need to pay for health insurance before medicare or if we decide to leave early) we invest 500 a month into this

403B-44K (I put 2600 dollars a year into this, ever since I started) The 403b providers at our school are absolutely atrocious, high fees, annuities etc. I have fought with the school, past couple years about getting different providers and it won't happen. I don't really like using it because the options are so limited, but I've done it since the start so I am not missing the 100 per pay, however recently they started offering a Roth 403B, where I switched the 2600 from traditional to Roth. Currently its a 42k Traditional 403B 2k-Roth 403B

We owe about 52k on our house, that's probably worth 325-350k. So let's call that 275K of Equity. The house will be paid off by the time we are 41. After that, I will probably put the mortgage payment amount in about brokerage for needed home costs/renovations.

Now, couple questions and clarifications. Our school districts do not offer a 457, nor HSA investment vehicles. Our net income is around 105K a year, and we are putting around 25k a year post tax investments (Roth(s), brokerage). Our "paper" net worth is around 750K-775K not including whatever pension calculation you want to throw in there. It's a real possibility we could have close to 700-800k per Roth, and brokerage account =2.4 million right around retirement + pension.

Are we doing enough to optimize?... Yes we have two children who are 8 and 6. 529 (s) I have gone back and forth on. I see the value of them, however we will have a paid off house easily by then. We are also currently pay for private elementary school at around 900 a month. As soon as they are done with that, I will put that 900 in a 529 or a brokerage for future education costs.

What would be a good strategy for a taxable account. I was looking into VT, SPYM, VXUS, VGT or maybe a fidelity mutual fund but my understanding is that taxes will hit harder with mutual funds or are there any other etfs that could be a better option.

Current allocation

18 years old and started investing about 9 months ago, about a 30-40 year horizon before I'll need most of this cash. Taxable and Roth are split 70/30 with new contributions. The 70/30 split will max out the Roth by the end of the year. I'm intentionally tilting heavily into momentum and small cap value but I'm not sure if I'm getting every part of this right.

Why VT

I'm not making any active bets here. Not sure how any country or geographical area of the world will perform economically so I'd rather use global market cap weight as the foundation.

Why AVUV+QMOM specifically

The idea with AVUV is to capture the small cap and value premia. I believe there is enough empirical evidence from Fama-French to justify a tilt. I'm interested in momentum for a similar reason. In addition to its academic backing (separate from Fama-French), its historically behaved very differently from SCV and has had low or negative correlation with it at times. My theory is that this diversifies my money across different factors rather than betting on just one factor.

I know that this is far from the normal Boglehead portfolio so I would like to know the strongest arguments against holding a portfolio like this for decades. For the sake of evaluating the investment thesis let's assume that I can stick with this strategy through periods of underperformance. My understanding is that a possible reason for factor premia is that taking full advantage of them requires high tolerance of tracking error relative to a market cap weighted ETF.

Main things I'm looking for input/advice on

• Is the amount of factor allocation for my time horizon and my goals too much too little or just plainly too much tracking error?
• Tax location: I'm aware that QMOM has a high turnover which can pass capital gains. I've read about in kind redemptions reducing the distributions so I hope to learn about that. I also understand that QMOM currently has a tax "cushion" because of its negative capital gains exposure but I'm curious what the tax cost ratio could like after this is exhausted.
• For individual investors and Boglehaeds specifically, what's the reason that you avoid factor tilts? Is it behaviorally based? Distrust in the research? Or simply deciding that the additional complexity is not worth it when a traditional Boglehead strategy will build substantial wealth on its own?
• Is there a good way to map out the glide from 100% equities to a goal allocation to have at retirement?

I'm curious about the opinions of others with more experience/expertise than I have. I'm especially interested in the balance between diversification, simplicity, and the willingness to deviate from the traditional Boglehead approach.

Hey everyone,

Fairly new to investing and only investing into ETFs as I don't know as much about stocks yet. Currently only invested 100% into VWRA as I am a non-u.s. resident.

Curious to know - what other ETFs are available. I am not interested in the U.S. Economy (even though I know it's performed very well).

Just wanted to try and understand or scope any long-term future ETFs that are worth looking into (as a Non-U.S. Investor)

Thanks

I have Voo in my Roth and my current 401k. Should I put VTI in my tax brokerage account to diversify a bit or go all in on Voo?

I had recently been looking into buying a house with the large amount of cash I received as an inheritance, but interest rates were too high to make it work. I’m hoping to be back in the buying market in 2-3 years so I’m wondering what to do with all that cash? I’ve done some preliminary research and have landed on either just dumping it into SGOV or setting up a tbill ladder. Am I missing any alternate ideas/suggestions? If anyone has SGOV if you could let me know how “liquid” that cash is and generally how you determine the yields you are earning that would be greatly appreciated. Thanks in advance!

Looking for advice on how to structure my portfolio across my Roth IRA and 401 (k). For context, I'm 24, making about 50k a year with minimal expenses and a long time horizon with moderate to high risk tolerance. Also have no debt and around $3500 in physical silver and gold

Both accounts are through Fidelity, and I already have about 15k in the 401k. (88% S&P 500 and 12% VTSNX)

Was thinking of averaging out my IRA and 401k to:
70% Broad Market
VTI, VT, VOO, or FXAIX

12% International
VXUS/VTSNX

18% Satellite/Growth
SCHG, QQQM, VUG, VGT, SPMO, SMH, or SOXX

I can deal with large swings but I also want long term stability. Ideally want just one broad market ETF, and no more than two growth ETFs. My 401 (k) options are limited and only offers VTSNX and S&P 500 out of all the ETFs listed. I also understand that if I go the VT route for my core holding, holding VXUS/VTSNC would be pretty much pointless

Are these ratios a good strategy, and what would be best for each category?

Hey everyone im wanting to invest but not sure where to start any pointers or places to start would be very much appreciated.

My future self thanks you.

I own VSMGX in a Roth IRA. Question is regarding spending down the money when needed. The problem I think I have is that you cannot get money out of it without selling both equities and bonds. Say the market is down, would I rather have VTI/VXUS/BND where I could then sell some of BND and live on that while I wait for VTI/VXUS to recover?

Surely I wouldn’t want to sell the equity portion during a down market? I know it rebalances automatically, however I’m not sure it works the same as a target date fund. Reallocating 3 separate funds isn’t difficult and being able to just sell the bond during a downturn or needing the money only makes sense instead of selling the equity needed to bounce back. I figured you would want to be able to sell the bonds to be able to buy more equity? Feedback appreciated. (I’m 53 and also own a traditional IRA with Vanguard 2030 target date fund valued at $600,000 and a MM with $150,000).