saltywalden
Confused about dryer sheets
- Joined
- Feb 21, 2021
- Messages
- 6
Hi All, I'm seeking advice and opinions on how to handle taking over control of some assets I have with a wealth manager.
Background:
I've had a wealth manager for the past few years with control of about 25% of my investable net worth. He was great, no complaints, but I've learned more about investing and frankly have become a boglehead so it is time to drop the 1% fee drag. (It was actually kind of hard to break up with him, but it went well.)
Where we are now:
I will have all of those assets he was managing, which are already at Fidelity transferred to a Fidelity account under my control. It is currently invested in about a dozen different funds, mostly iShares ETF, but also at least one individual stock and one Fidelity managed fund. The funds are "fine" I guess, but it seems none of them beat the S&P 500 over the last 5 or 10 years and they have expense ratios ranging from 0.2 - 0.8+%. As a boglehead, this makes me sad.
I'd like to get them all into FSKAX, but here is my dilemma. I'm sitting on about $100,000 in gains in that account. Liquidating it all right now would lead to $25,000 in federal taxes. That seems like a bad move, even with the fees and slightly lower return, it will be hard to make up that $25k.
Some information that may be helpful for advice giving:
I intend for this money to sit un-touched (no withdrawals, no contributions) for at least 10 years. It represents about 25% of my total equities including all 401(k)s, IRAs, and a Vanguard taxable account. If I liquidated it all at once, some of the gains will be short term gains.
What do you think? Just leave it all in those funds? Move a little bit, say $15-20k of the gains per year out of the most expensive funds? Something else entirely?
Thanks for taking the time to read through!
Background:
I've had a wealth manager for the past few years with control of about 25% of my investable net worth. He was great, no complaints, but I've learned more about investing and frankly have become a boglehead so it is time to drop the 1% fee drag. (It was actually kind of hard to break up with him, but it went well.)
Where we are now:
I will have all of those assets he was managing, which are already at Fidelity transferred to a Fidelity account under my control. It is currently invested in about a dozen different funds, mostly iShares ETF, but also at least one individual stock and one Fidelity managed fund. The funds are "fine" I guess, but it seems none of them beat the S&P 500 over the last 5 or 10 years and they have expense ratios ranging from 0.2 - 0.8+%. As a boglehead, this makes me sad.
I'd like to get them all into FSKAX, but here is my dilemma. I'm sitting on about $100,000 in gains in that account. Liquidating it all right now would lead to $25,000 in federal taxes. That seems like a bad move, even with the fees and slightly lower return, it will be hard to make up that $25k.
Some information that may be helpful for advice giving:
I intend for this money to sit un-touched (no withdrawals, no contributions) for at least 10 years. It represents about 25% of my total equities including all 401(k)s, IRAs, and a Vanguard taxable account. If I liquidated it all at once, some of the gains will be short term gains.
What do you think? Just leave it all in those funds? Move a little bit, say $15-20k of the gains per year out of the most expensive funds? Something else entirely?
Thanks for taking the time to read through!