What Your Advisor Should Tell You About Rebalancing Tax Boundaries

Episode 51 tackles the overlooked friction between portfolio rebalancing and the tax code. Lucas walks through a real example: a client with a 60/40 stock-bond split whose bond allocation drifted to 48 percent after the 2025 equity rally. The conventional advice is to sell stocks and buy bonds — but that triggers capital gains in a taxable account. Instead, Lucas explains a smarter approach: redirect new dividends and new contributions toward the underweight asset, use tax-advantaged accounts as rebalancing buffers, and only sell when drift exceeds a five-percentage-point band. Luna pushes back on threshold rigidity, and they debate whether tax-loss harvesting and rebalancing can coexist in the same strategy. The episode closes with a question for listeners: when did you last check your actual vs. target allocation? #Rebalancing #TaxEfficientInvesting #PortfolioManagement #AssetAllocation #CapitalGains #TaxLossHarvesting #DividendReinvestment #TaxAdvantagedAccounts #FinancialAdvisor #WealthManagement #60Portfolio #BondAllocation #EquityRally #2025Market #FiduciaryDuty #PersonalFinance #FexingoBusiness #BusinessPodcast Keep every episode free: buymeacoffee.com/fexingo