Masters in Business At the Money: How to Pay Less Capital Gains Taxes
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Jan 24, 2024 In this podcast, Barry Ritholtz speaks with Ari Rosenbaum about investment strategies to avoid big tax bills. They discuss direct indexing and tax loss harvesting, the benefits of diversification, and reducing capital gains taxes through risk-aware exposure. The podcast explores how these strategies can save investors money on their tax bills and optimize their returns.
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Tax-Loss Harvesting Basics
- Consider tax-loss harvesting to lower your tax bill on non-tax-deferred accounts.
- Sell poorly performing assets and replace them with similar ones to offset gains.
Mutual Fund/ETF Limitations
- Tax-loss harvesting opportunities are limited with mutual funds and ETFs.
- Markets typically rise, leaving fewer chances to capture losses at the fund level.
Direct Indexing Advantage
- Direct indexing lets you own individual stocks within an index (like the S&P 500).
- This unlocks more tax-loss harvesting opportunities than owning the index as a whole.