I need some help as I will have a big decision coming up with buying a new car. Hopefully my current one will last awhile, but its not looking very likely. Im concerned about the most tax efficient way to draw out some money from my taxable accounts. Speaking with another Boglehead friend of mine, I agree that cash is fungible, so I decided not to grow an online savings account raising cash for a car purchase, and have instead invested as follows.
VTSMX 10K admiral shares held less than a year (about even from cost basis, maybe slightly down)
VWITX 19K currently DCA'ing but most has been held less than 1 year (up a few hundred dollars from cost basis)
VGPMX 3K (Prescious metals stocks index) held less than a year (down a few hundred dollars from cost basis)
VTSMX 16K investor shares held for 3 years (up about 6000 dollars from cost basis)
Cash 13K (most $ needed for Roth IRA 2012 contribution, and e-fund)
Ok, so the question is: IF I NEED APPROXIMATELY 25K CASH TO BUY A CAR ONE MONTH FROM TODAY, WHATS THE MOST TAX EFFICIENT WAY FOR ME TO MAKE THAT HAPPEN? Keeping in mind the following...
-Im in the 25% tax bracket
-My portfolio allocation (as a whole) is about 70/30 stocks/bonds, which is where I want it to be. But Im not too concerned about throwing it off too much, as my plan will to be to quickly buy my way back into proper 70/30 allocation after I buy the car.
-I cant really spare much cash for this, so I will have to sell at least 20K of taxable assets
-I dont want to finance
I cant think of anything else that would be relevant, but if so, please ask.
Thanks.
Side question, before I click submit...Do you all agree that cash is fungible, or should I stop DCA'ing into VWITX, while I agressively raise cash, and hope my current car can last awhile? Any other thoughts are appreciated.
VTSMX 10K admiral shares held less than a year (about even from cost basis, maybe slightly down)
VWITX 19K currently DCA'ing but most has been held less than 1 year (up a few hundred dollars from cost basis)
VGPMX 3K (Prescious metals stocks index) held less than a year (down a few hundred dollars from cost basis)
VTSMX 16K investor shares held for 3 years (up about 6000 dollars from cost basis)
Cash 13K (most $ needed for Roth IRA 2012 contribution, and e-fund)
Ok, so the question is: IF I NEED APPROXIMATELY 25K CASH TO BUY A CAR ONE MONTH FROM TODAY, WHATS THE MOST TAX EFFICIENT WAY FOR ME TO MAKE THAT HAPPEN? Keeping in mind the following...
-Im in the 25% tax bracket
-My portfolio allocation (as a whole) is about 70/30 stocks/bonds, which is where I want it to be. But Im not too concerned about throwing it off too much, as my plan will to be to quickly buy my way back into proper 70/30 allocation after I buy the car.
-I cant really spare much cash for this, so I will have to sell at least 20K of taxable assets
-I dont want to finance
I cant think of anything else that would be relevant, but if so, please ask.
Thanks.
Side question, before I click submit...Do you all agree that cash is fungible, or should I stop DCA'ing into VWITX, while I agressively raise cash, and hope my current car can last awhile? Any other thoughts are appreciated.