Explain tax advantaged taxable investments? DO they come in "target date" flavor?

[BuckyBadger]

I'm using target date funds for my 401k and IRAs, but will soon be adding taxable accounts to my "portfolio."

Can someone explan to me how to keep taxable accounts as tax-advantaged as possible? We're meeting with a potential advisor on Tuesday but I wanted to ask here first.

I'm hoping that there is some sort of target-date taxable fund I can contribute to. I really want this to be as decision-free as possible...

[Petunia 100]

I'm using target date funds for my 401k and IRAs, but will soon be adding taxable accounts to my "portfolio."

Can someone explan to me how to keep taxable accounts as tax-advantaged as possible? We're meeting with a potential advosor on Tuesday but I wanted to ask here first.

I'm hoping that there is some sort of target-date taxable fund I can contribute to. I really want this to be as decision-free as possible...

You want to avoid stock funds which trade frequently (MorningStar will give you this information, look for "turnover ratio"). Index funds are tax-efficient, especially total market index funds. Some actively managed funds make tax efficiency their goal, look for "tax-managed" in their title. You will have to use judgment to determine if they are doing a good job keeping taxes low or not.

Target date funds will be tax efficient while you are young, but eventually will reduce stocks, selling them in favor of bonds. When that happens, you will have taxable gains plus increasingly more taxable dividend income.

I would avoid buying any fund based on its current manager in a taxable account. If the manager leaves down the road, where does that leave you? With a fund you don't want to own but can't sell without triggering a tax event. If there is some "star manager" who's fund you want to buy, do it in a tax-advantaged account.

In short, I would stick with a total market stock index fund.