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Larry’s 2023 Perspective
January 18, 2023Greetings to subscribers, both new and seasoned. As we begin a new year, there is some good news...
Great podcast Larry. Keep up the good work!
Thanks……..will do!
Hi Larry. I recently purchased your book and listened to the podcast… what a breath of fresh air for me. I must admit I am (soon to be ‘was’) a victim of the banks and their high cost mutual funds… plus a financial planner with fees on top of the MER’s.
I’m retired and have spent the last couple months researching options. After just finishing your Book, I now have the confidence to invest on my own. I recently set up a Direct Investing Account and will be selling the mutual funds and ‘divorcing’ the financial planner to buy Balanced ETF’s myself.
Question for you… I have some investments in mutual funds… and they’ve done well since I’ve had them the last 3 years. Altogether, they’ve have a nice gain. My question is… should I sell them all in Jan 2020 and realize the full capital gain that year? Or sell them over 2 years to spread the capital gain? I’m leaning towards option 1 to sell the mutual funds asap.
Would you mind giving me your brief advice?
Thanks
KP
Hi Ken. That is a good question. I do not know your personal situation so can’t give you a yes or no. Spreading gains over a couple of years may make sense if selling them all at once moves your marginal tax rate up a notch. You could sell some now and sell the balance in January. Good luck!
Larry
Thanks for your advice Larry.
I really like the simplicity of VBAL, as you mention on page 177 in your book.
One question… if VBAL is used in a TFSA, is there withholding taxes, since a portion of this ETF is in the US Market? Or is this withholding amount so small it’s insignificant?
Thanks again for all your incite!
There will be a small amount of US withholding tax applied to VBAL holdings in a TFSA but I think it is a small price to pay for the simplicity/convenience.