Federal tax bracket: 37%
California tax bracket: 10.3%
California capital gains tax rate: 11.3%
Finishing up my first year gig, saved up $355,000 currently in VUSXX taxable account (I used MM Optimizer Vanguard)
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Goal is to save up $500,000 for a 20% down payment on a $2.5 million dollar home. Probably have enough in another 3-4 months.
I saw someone on this forum mention :
VCTXX -- (Money market) Use it like a savings account; in a high tax situation its 1.5% yield at a CD like volatility is where I keep a year of upcoming expenses
VWSUX --(US short term bonds) I use this instead of the VBIRX you use as its tax free on federal at least. I recently kept a downpayment on a house in it for 6 months and traded of the volatility risk for the added return over VCTXX. I am phasing it out now that I've bought the house to focus on the next two.
VCADX --(California intermediate term). Real volatility here, but not that bad compared to its after tax returns if you are holding for a while. Compares well to VTEB yield and bonus of lacking CA taxes.
VCLAX -- (CA longer term) I go against the orthodoxy* and hold 1/3rd of my bonds in this longer term CA tax free fund. I never plan on selling it and see its yield as an emergency fund of sorts. When you are paying 51% taxes in California its current 3.44% tax free distribution is nice to have in an after tax portfolio. Many Bogleheads do not own longer term bond funds like this.
The MM Optimizer lists VCTXX; however, I just wanted to make sure I'm not missing anything. Much appreciated for any advise.
California tax bracket: 10.3%
California capital gains tax rate: 11.3%
Finishing up my first year gig, saved up $355,000 currently in VUSXX taxable account (I used MM Optimizer Vanguard)
Goal is to save up $500,000 for a 20% down payment on a $2.5 million dollar home. Probably have enough in another 3-4 months.
I saw someone on this forum mention :
VCTXX -- (Money market) Use it like a savings account; in a high tax situation its 1.5% yield at a CD like volatility is where I keep a year of upcoming expenses
VWSUX --(US short term bonds) I use this instead of the VBIRX you use as its tax free on federal at least. I recently kept a downpayment on a house in it for 6 months and traded of the volatility risk for the added return over VCTXX. I am phasing it out now that I've bought the house to focus on the next two.
VCADX --(California intermediate term). Real volatility here, but not that bad compared to its after tax returns if you are holding for a while. Compares well to VTEB yield and bonus of lacking CA taxes.
VCLAX -- (CA longer term) I go against the orthodoxy* and hold 1/3rd of my bonds in this longer term CA tax free fund. I never plan on selling it and see its yield as an emergency fund of sorts. When you are paying 51% taxes in California its current 3.44% tax free distribution is nice to have in an after tax portfolio. Many Bogleheads do not own longer term bond funds like this.
The MM Optimizer lists VCTXX; however, I just wanted to make sure I'm not missing anything. Much appreciated for any advise.
Statistics: Posted by Mesonoxian — Thu Nov 14, 2024 11:48 pm — Replies 1 — Views 179