The thing to learn is which kinds of investments create qualified dividends, and which ones create non-qualified dividends or interest that is taxed at ordinary income rates.
I've been trying to learn more about income tax, but as I'm regular w2, I don't see many options.
Qualified dividends are taxed on the (lower) capital gains scale.
Normal "taxable" bond funds like AGG create non-qualified dividends or interest, which hurts at your tax bracket. Emerging markets funds create some qualified dividends, but more are non-qualified, in general, so they're not ideal in a taxable account. A developed markets international index would be better suited to someone in your position.
You also need to consider the tax-exempt bond funds I mentioned, as they would create tax-exempt interest at both the Federal and CA state level.
Regards,
Statistics: Posted by retired@50 — Sun Sep 01, 2024 8:31 am