Wealthfront + Betterment
Was trying to use Betterment and Wealthfront together to compare their performance. Seems that this approach is BS for tax loss harvesting. Now, I switched off TLH on Betterment. However, I'm still not safe because of portfolio rebalancing. What is the best action to take now?
Two things: 1) One option might be to open one of the accounts in your spouse’s name. But that won’t work for wash sales if you file jointly. 2) Never take investment advise from a random person on the internet :)
Don't use both together. If you want to experiment, ask a friend to join one service while you experiment the other
Even without rebalancing you're not safe because holding the same security in multiple places screws up their ability to figure out the correct cost basis. You will have to redo by hand any calculation of cost basis that either company did, which since they do this daily could become an agonizing and tedious task.
Just pick one and watch the performance of the other.
There is also dividend re-investing that happens once enough cash accumulates. Together, your likelihood of having wash sales because of multiple services is very high
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Why did you turn off tax loss harvesting? Why do you think rebalancing is "unsafe"? Do you actually understand the point of those features? If you want total control of your portfolio, just day trade it away. If you want to maintain a hands-free, diversified portfolio with consistent risk profile while minimizing your tax exposure... use Betterment with TLH and rebalancing turned on.
Do you actually understand what op meant? If you have both betterment and Wealthfront, and turn on TLH for both, they might be doing wash-sales for you because they don’t know what the other service has sold for you in the past month
Even having TLH enabled for one of the two services will probably generate a ton of wash sales.