The Tax Questions Blog

Question: What securities should I hold in a taxable investment account?

I just opened a brokerage account and am wondering what I should buy - individual stocks, ETFs or mutual funds? Individual bonds or bond funds? What is the best for a taxable (not IRA) account?

Answer: It depends on your personal financial position. No one can give a credible answer to that question unless they know what assets you own, what your liabilities are & what your commitments are. It is also important to understand your tax position, which varies from State to State.

The only suggestion I can make is to go and see a Financial Advisor. In general terms they will tell you to make maximum possible use of your tax free allowance, and put those assets on which you would pay the most tax in the tax free accounts. The remainder goes in taxable accounts, and a Financial Advisor will be able to help you decide whether they should be stocks, ETFs, bonds or mutual funds.

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