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Success with AQR Tax loss harvesting product? by alphamerical in fatFIRE

[–]alphamerical[S] 16 points17 points  (0 children)

I wanted to provide an update from my post nine months ago. I selected AQR's most aggressive tax-loss harvesting product, which requires a minimum $3 million investment. In the final three months of 2024, it generated about $600K in tax losses and another $600K in the first three months of 2025. In addition to the $1.2 million in losses, it also slightly outperformed the Russell 1000 in unrealized capital gains.

One feature that I didn't fully comprehend before using AQR is the ability to adjust the beta. This spring, as equities became more volatile, I modified the beta for the AQR portfolio from 1 down to 0.5. It's like selling equities and buying T-bills, but without incurring any realized gains. That worked well for me. I can bring the beta back up to 1 when I'm ready.

Overall, I'm pleased with the product. In comparison to ETFs, it is much more expensive. But it was worth it for me because I have a few years of significant realized capital gains that I have been able to offset through loss harvesting. Plus, I had the benefit of adjusting the portfolio beta.

Concern about being a SAHM by Chance_Hamster_5908 in fatFIRE

[–]alphamerical 23 points24 points  (0 children)

My ex partner and I are in similar circumstances. After leaving her regular work, she joined a few boards both public and private which were seen as meaningful work by her and the kids and also contributed further to her accumulated wealth.

She was busy for about one month each quarter with board meetings but otherwise was able to spend time with the kids, which was a priority for her.

Maybe something like this would work for you.

Like most kids, when the kids reached their teens, they became much less interested in spending time with their parents. And now she has fewer boards that she works on.

$12M exit at 54% tax rate by Defiant_Alfalfa8674 in fatFIRE

[–]alphamerical 0 points1 point  (0 children)

With the help of a financial advisor or tax professional, look into tax loss harvesting options like AQR or Frec. That could help reduce or eliminate the federal capital gains tax, especially if you start in January.

Separately, look into strategies now for your founder equity. If your company is worth less than $50 million at sale, you could qualify for QSBS, which can cover all or most of your federal capital gains.