Saving for home, received gift of stock
Wife and I recently married 😄 been together 10 years. We had been saving for a house, put it on pause for our wedding, back to saving for it. Timeline is 1-2 years hopefully.
Mom surprised me. In January 2000, she invested into an actively managed mutual fund (mostly large caps, it's like an ultra concentrated VOO) for me and transferred it to me when we got married. As you can imagine, it's grown considerably in the last 26 years, and the tax bill is quite high. The fund is JNRFX with an expense ratio north of 80 basis points.
My first thought was, oh great! Now I can park all my savings into the market. If it appreciates in value, good problem to have! If it doesn't, I can sell at a loss and then offset with the JNRFX. Risk free growth!
After running some calcs, I'm realizing that with the amount we're able to save vs. the capital gains tax on JNRFX, the market would have to have a catastrophic loss to offset the taxes even a little bit, and then the value of JNRFX would tank as well. In the absolute impossible dream scenario, I put all my savings into an uncorrelated asset (international stocks?), they tank, somehow US markets don't, and in the end, the amount I'd be saving on the tax bill is still not all that much.
So now, I'm thinking the best course of action is to sell JNRFX, eat the tax bill, and park it into SGOV to preserve that capital for when the right house comes along - and of course, park all excess savings into SGOV as well. The preservation of the current JNRFX value has to be worth more than the amount I'd be offsetting with losses in the perfect scenario.
Is my line of thinking correct here? I'd take advice, reassurance, all of it. Thank you!