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I started with and was a Wealthfront customer for many years. I'm appreciative and credit them with starting my education and understanding on investing. What

I started with and was a Wealthfront customer for many years. I'm appreciative and credit them with starting my education and understanding on investing. What caused me to leave? - They aren't global portfolio aware. Bonds belong in tax advantaged accounts, then taxable. If you've maxed out your 401k/IRAs in Bonds that $ as an absolute percentage should be accounted for in your taxable portfolio construction. - They don't let you opt out of asset classes. Aka I don't want additional REITs because I have RE exposure already. - They overly hype tax loss harvesting. It's good to have, but a byproduct of portfolio management not the goal. - They launched and pushed risky products as a way to increase their fees. Once you understand what's going on under the hood this isn't complicated to manage yourself with a few ETFs/MFs. (The direct indexing is awesome and would love to have that back)

PascLeRasc 5y ago
You can opt out of asset classes now. I moved out of Wealthfront to save money and try to DIY but so far I've had a really hard time doing it in terms of finding time to place the buy order during the workday and doing tax loss harvesting without wash sales.
sharx 5y ago
I've heard that when you leave direct indexing you end up with all the individual stocks in your new portfolio, or you have to sell them and eat the capital gains tax. Was that your experience?
- clamstar 5y ago
  You end up with a bunch of individual stocks in your new brokerage account. It's a pain. I separate account at etrade specifically for my "WF500" shares, and still just treat them as a single organism.
- ppg677 5y ago
  Yes that was my experience. And it sucked. I had 500 individual stocks to deal with.
rjj 5y ago
Why do bonds being in tax advantages accounts? My gut would suspect the opposite, since on average stocks will have higher return so you'll want them getting the tax break.
- clamstar 5y ago
  Taxes on dividends.
- itake 5y ago
  bond dividends/interest are taxed like regular income. stocks (capital gains) are taxed at a lower rate.
- refurb 5y ago
  Bonds have defined maturities and bond indexes are made up of a mix of short, medium and long term bonds. So over the course of time, old bonds mature and pay out (taxes due). Equity indexes have no maturity date and can limit any taxable income to dividend only which get preferential treatment in terms of taxes.
Bostonian 5y ago
"Bonds belong in tax advantaged accounts, then taxable." That's true when say taxable bonds are yielding 8% and municipal bonds 6%. But when taxable bonds are yielding 2% (about the current 10-year U.S. Treasury yield), the tax hit from owning them in a taxable account is small, and maybe the growth assets such as stocks belong in a Roth IRA.
- devoutsalsa 5y ago
  The taxes are small, just like the returns. I can’t really see bonds as a an indiviy investment in an era of low interest rates. And they only go down in value if interest rates start going up.

PascLeRasc 5y ago

You can opt out of asset classes now. I moved out of Wealthfront to save money and try to DIY but so far I've had a really hard time doing it in terms of finding time to place the buy order during the workday and doing tax loss harvesting without wash sales.

sharx 5y ago

I've heard that when you leave direct indexing you end up with all the individual stocks in your new portfolio, or you have to sell them and eat the capital gains tax. Was that your experience?

clamstar 5y ago
You end up with a bunch of individual stocks in your new brokerage account. It's a pain. I separate account at etrade specifically for my "WF500" shares, and still just treat them as a single organism.
ppg677 5y ago
Yes that was my experience. And it sucked. I had 500 individual stocks to deal with.

rjj 5y ago

Why do bonds being in tax advantages accounts? My gut would suspect the opposite, since on average stocks will have higher return so you'll want them getting the tax break.

clamstar 5y ago
Taxes on dividends.
itake 5y ago
bond dividends/interest are taxed like regular income. stocks (capital gains) are taxed at a lower rate.
refurb 5y ago
Bonds have defined maturities and bond indexes are made up of a mix of short, medium and long term bonds. So over the course of time, old bonds mature and pay out (taxes due). Equity indexes have no maturity date and can limit any taxable income to dividend only which get preferential treatment in terms of taxes.

Bostonian 5y ago

"Bonds belong in tax advantaged accounts, then taxable." That's true when say taxable bonds are yielding 8% and municipal bonds 6%. But when taxable bonds are yielding 2% (about the current 10-year U.S. Treasury yield), the tax hit from owning them in a taxable account is small, and maybe the growth assets such as stocks belong in a Roth IRA.

devoutsalsa 5y ago
The taxes are small, just like the returns. I can’t really see bonds as a an indiviy investment in an era of low interest rates. And they only go down in value if interest rates start going up.