RetireJapan

I guess people are already thinking about Nisa 2025. Any change in strategy for the new allocations?

Absolutely not.

100% all world stock mutual fund for me.
Mix of all world stock mutual fund and dividend paying Japanese stocks for the wife.

I'd be interested to know if people are planning on paying a lump sum to fill up the quota right away or setting up monthly contributions.

Am I right in thinking that the former may statistically be the better approach, but the latter is less vulnerable to sudden exchange rate or market drops?

FriendlyFox wrote: ↑Fri Oct 18, 2024 5:54 am I'd be interested to know if people are planning on paying a lump sum to fill up the quota right away or setting up monthly contributions.

Am I right in thinking that the former may statistically be the better approach, but the latter is less vulnerable to sudden exchange rate or market drops?

Yes, but the latter is much easier too

Don't forget that exchange rates and the market can move in your favour too.

At the end of the day for me the potential advantage of trying to game the tsumitate portion in order to invest a lump sum in January is not worth the effort, but that is not a blanket recommendation!

FriendlyFox wrote: ↑Fri Oct 18, 2024 5:54 am I'd be interested to know if people are planning on paying a lump sum to fill up the quota right away or setting up monthly contributions.

Am I right in thinking that the former may statistically be the better approach, but the latter is less vulnerable to sudden exchange rate or market drops?

You’ve given me the urge to try and be clever and switch some of my taxable holdings into nisa holdings “when the market and/or dollar/yen rate is going down”.

But I have monthly tsumitate set on auto-pilot, so by default I will not do that.

This past August was the good time to have done that this year but, but I didn’t really get around to it. One clever fellow here was doing tsumitate everyday around that time, well done to them!!

See the same discussion last year

viewtopic.php?t=2998

We have a few yen in a taxable vanguard fund.
So our plan was to just leave it there to grow. Sadly it would pay tax if we make a withdrawal. Now the lump sum element is in place I was wondering , (since it’s not actually new money)if it’s better to move it to the tax advantage NISA for the next 6+ years. it will be sold at the rate in December and the rebought asap in January.
My reasons are
1. Letting it accumulate in the old account incures taxes on withdrawal.(now or in 6 years) Doesn’t seem efficient!
2 put it into the NISA, now , pay the tax.(which would happen in the account in 6 years anyway. And let it continue to grow, with the tax advantages of future gains.
3 currency sold ($$) and rebought asap in ($$)would hopefully reduce any losses on currency fluctuations but nobody knows what could happen in a 10 day period.
4. Nobody knows where the currency will be in 1 year or 6 years.
5. I’s known it can continue to grow tax free for another 6+ years. And it is known it could crash no matter the fund! So does it matter if it’s in a NISA? Or NOT?
My thinking is move it to the NISA!

Any reasons NOT to move it?

Depends on your current gains, how much you currently have, what the fees of your broker are and if you can (and want) to fill NISA with salary and other savings. Without these info it's hard to give advice.

Bubblegun wrote: ↑Tue Oct 22, 2024 6:15 am Any reasons NOT to move it?

adamu wrote: ↑Thu May 04, 2023 9:34 am Personally I'm going to KISS and focus on new investments, leaving taxable holdings alone, even if it's not the most efficient. I think less tinkering and focusing on increasing the savings rate if possible it probably more valuable long term (in terms of good habits and increased savings rate) than making use of every last yen of the NISA allowance from day one.

Chizakura wrote: ↑Tue Oct 22, 2024 6:29 am Depends on your current gains, how much you currently have, what the fees of your broker are and if you can (and want) to fill NISA with salary and other savings. Without these info it's hard to give advice.

Excellent points.
1) I wont be able to fill next years allocation from my salary.
2) continue to DCA as usual 80,000 a month.
3) There is about 15 million in both taxable funds.
4) Gains almost doubled.
5) Fees, I don't know, but they deduct the tax.

But your thoughts would be helpful.
I am aware of survivors bias, and I'd hate to make a mistake based on that idea.

Since the new system came into play, it's added an extra layer of caution in our calculations, and risks.
Previously since we never had the NISA or IDECo the Vanguard account was just set and forget as a Global fund.