After continuing to be hammered by taxes year after year, I am in a good position to eliminate my holdings in the actively managed fund VWIAX - Vanguard Wellesly Income. It was pretty decent when I first started since the nonqualified dividends and capital gains distributions didn't really affect me too terribly. 10 years later that is not the case. As an added benefit, I will be able to harvest around $4900 in long term capital losses.
After the sale, I will have right around $200K in my settlement fund. I already have a really strong position in VTSAX. I also have around 360 shares of VYM and far too many shares of VWUAX, which I am actively working at reducing.
So my first option is to put the whole thing in VTSAX (VTI) and let it ride. Long term, I doubt I would have any regrets. The nice thing is the dividends are like 95% qualified so the tax impact would be marginal, especially after not having VWIAX anymore.
Another option would be to take the $200K and do 70/30 VTSAX/VXUS since I currently have no international exposure. Performance wise international seems to be on quite a streak but it still lags long term. One potential benefit is the potential for the Foreign Tax Credit.
The other option I have been considering is $100K VTSAX and $100K VUG or SCHG or QQQM. There is a 40-45% overlap with VTSAX, but it could help to maintain a bit of a growth tilt, especially if I can continue to reduce my holdings in VWUAX.
I'm leaning toward the latter option right now and know VUG has a 6-to-1 split coming on Tuesday. I figured this might be a good place to post to see if I'm missing something that others might see. I'm not asking which would be best, but more just an outsiders analysis of the options I have already mentioned.
Thanks!