Franked Divvy-Maxing Now the Optimal Play?
Assuming, the budget actually passes in its present form.
That is a big assumption. For now I, for one will wait and see what happens.
But if it does, VHY, YMAX, SYI and IHD are all looking very good right now. They are also in the approved investment list in NAB Equity Builder and negative gearing is still a go with ETFs, so that's a big plus.
YMAX has the advantage of being able to use the capital losses to offset any crystalized growth stock/ETF capital gains, although how to turn that into a strategy w/o incurring wash sale , I don't know.
There is the matter of paying higher tax now though, not sure if that beats deferred capital gains with a 30% minimum or not. LMK if anyone has run the numbers on this!
For us personally, we are still in accumulation phase. Messy middle. Due to timing we have some dry powder right now ready to go. I don't think we will sell any of our growth ETFs. Whether we sell now or later, we will still get taxed on it. Might be best to hold until we die or until we have to sell. Or if there is a capital loss to offset the gain in a given year, in which case sell a portion and park it in cash or bonds.
Regardless, having a decent portion of the portfolio in high yield dividend/distribution equities for that first tranche of low marginal tax seems like a good plan?
What are everyone's thoughts? What are your plans? Also has anyone run any numbers yet?