Distributing vs. Accumulating ETFs in 2024 (European Investor)
Рет қаралды 38,035
Күн бұрын🇪🇺 Best EU Broker: angelo.fi/ibkr
Should you buy a distributing or accumulating ETF? The decision is not as easy as you may think. Here is everything you need to know about accumulating vs. distributing ETFs as a long-term investor based in Europe. Links below!
My Favorite Brokers (ETFs, Stocks and Bonds):
🇪🇺 Interactive Brokers: angelo.fi/ibkr
🇪🇺 Trade Republic (4% interest p.a.): angelo.fi/trep
🇩🇪🇦🇹 Easiest for Germany & Austria: angelo.fi/etfs
👉 Compare ETFs & Stocks: angelo.fi/comp
TIME-STAMPS:
00:00 Distributing vs. Accumulating ETFs - Intro
01:31 Pros & Cons of Dividends
02:44 A Story Of Two Investors
05:02 My ETF Investment Strategy
Vanguard FTSE All-World Accumulating (IE00BK5BQT80, VWCE)
06:31 Conclusion
My Investments in P2P Lending:
📌 Esketit (0.5% bonus): angelo.fi/esketit
📌 Mintos: angelo.fi/mintos
📌 Viainvest (1% bonus): angelo.fi/viainvest
📌 Debitum Network (1% bonus): angelo.fi/debitum
📌 Income (1% bonus): angelo.fi/income
📌 Lande (1% bonus): angelo.fi/lande
💰 All P2P deals & conditions: angelo.fi/all
I Hold My Emergency Fund (Cash) Here:
🇪🇺 4% interest p.a. (€100K deposit guarantee!): angelo.fi/save
📈 What I Use to Track my ETFs: angelo.fi/getq
🏠 All my investments & accounts: angelo.fi/tools
Video mentions:
📌 Vanguard FTSE All-World ETF Acc. (VWCE)
🎥 ETF Investing Playlist: kzfaq.info?list...
Thank you for watching, I hope you enjoyed the video!
#ETFs #Investing #Stocks
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Some of the links are affiliate links, which help support me and the KZfaq channel. I only link to services I use and am convinced of myself, none of the links are sponsored.
Disclaimer: I am only sharing my own experience. I'm not a financial advisor and you should always do your own research and due diligence before investing. Investing involves risk of losses.
@AngeloColomboFi 2 жыл бұрын
What do you prefer, Distributing or Accumulating ETFs? :) 🇪🇺Interactive Brokers: angelo.fi/ibkr 🇪🇺Trade Republic: angelo.fi/traderepublic 🇦🇹🇩🇪Germany & Austria: angelo.fi/etfs (I recommend using these for tax reasons if you're based in Austria or Germany!) 👉Compare ETFs & Stocks: angelo.fi/analyze 📈Where I track my ETFs: angelo.fi/getquin 💰All my investments (incl. P2P lending): angelo.fi/tools
@pauldechampignon2287 2 жыл бұрын
"Let's imagine it's 2022 and stock market crashed." Well predicted!
@pedropintogarcia617 2 жыл бұрын
Finally!! A great European investing youtuber, and luckily, I've recently moved to Austria, so your channel is like a holy grail for me at the moment !! Thanks Angelo :D
@Tommyleon225 2 жыл бұрын
Really informative, thanks for the update!
@AngeloColomboFi 2 жыл бұрын
Thank you Thomas!
@marijalisicyna7082 Жыл бұрын
Made me smile with this 2 Angelos. Very well explained!!!
@AngeloColomboFi Жыл бұрын
Happy to hear that! :)
@lorenzhoekstra2095 2 жыл бұрын
thanks for the helpful videos!
@MrPAuan 2 жыл бұрын
Hi Angelo, thank you for your VDO! It is really helpful. I was wondering what is the benefits of manually buying ETFs vs Saving plans? I know that saving plans with scalable capital will deduct the amount automatically every month. I wonder if the price of ETFs is the crucial factor for people not setting up saving plans, so they can decide on the price they would love to buy? TIA
@aikateriniliakopoulou3353 2 жыл бұрын
Very helpful video Angelo. I notice that in the case of "Vanguard S&P 500 ETF" for example XETRA offers the "accumulating" mode while AEM the "distribution" mode. AEM transaction is commission free while is not the case for XETRA. How you'd tackle this?
@GDeCe-ft9us 2 жыл бұрын
I love your content and how you explain things! I really useful especially for people like me that have 0 knowledge of finance and investing!
@AngeloColomboFi Жыл бұрын
Thank you, I really appreciate you telling me that!
@thenikodimcho Жыл бұрын
Hi Angelo, thanks for sharing! Great video. If I buy a distributing ETF in EUR from a US stock exchange won't be able to avoid the taxes?
@clomaximus1836 2 жыл бұрын
Would it make sense to maybe get accumulating etfs and then also a distributing high dividends etf to remain motivated?
@user-mb7nf3nn9j 11 ай бұрын
Thank you bro!!
@ondrejkacaba6817 2 жыл бұрын
Hi. Why is iShare s&p 500 acc so expensive (over 300 eur) in comparison to same index ETF like Vanguard s&p500 or even iShare dist???
@heihops8870 2 жыл бұрын
For example: The assets return 10% annually, 7% as capital gains and 3% as dividends. DIST etf pays this 3% to investors as a dividend distribution aś cash, but does this DIST etf has also compounding effect for future with this 7% or not?
@Paddlehappy Жыл бұрын
Thank you for this video. How can I see the difference in the accumulated ETF, in my case VUAA, as this is not distributed dividends.
@RalucaParaschivu 2 жыл бұрын
Hi Angelo, thank you for sharing this! I also live in AT and I have no idea how to do my taxes with ETFs in AT. I have an accumulating ETF for now, but what if I want to live out of my dividents in 10 years or so? Do I need to sell or just move everything to a non-acc ETF? It would be great if you could provide a video on Tax in AT and what to do when you are ready to retire. I would be very interested in both topics. Do you know or recommend any consulting in AT regarding tax? Btw Accumulating isn't taxed right?
@AngeloColomboFi 2 жыл бұрын
My pleasure Raluca! Are you using Flatex? In that scenario, you wouldn't have to deal with it at all. If not, send me a message, as it's too complicated to explain in detail in a KZfaq comment: p2pinvesting.eu/contact
@Jose_Zuell 2 жыл бұрын
I do not know which percentage of your viewers are based in Austria, and if it is worth the effort for you. But a video about ETFs and taxes in Austria would be great! In fact I was going to start researching about it :) My German level is not enough to understand Flatex conditions, so I went with Degiro.
@nathanlenas8671 4 ай бұрын
Thanks for the video! ACC or DIS? Is it better to invest as low as 50 euro’s in both so I can profit short and longterm or 100 euro’s in one of the two considering taxation in my country on dividend of course?
@tommartens1447 2 жыл бұрын
The first ETF i've Bought when I started about 8 monthes ago is the one you mentioned here. The Vanguard FTSE All-World UCITS ETF USD, I've bought the accumulating one to start with and now i've got 3 of them. But for the most of my portfolio it are distributing ETF's.
@Dusan698 5 ай бұрын
how much do you have now?
@GabrielIonescuisro 11 ай бұрын
Thank you for the videos you make, I also wander around ETFs, what are the ones ore one that I should go for the long run, you made a bit more light on the path to invest. I use Trading 212 and etoro, but it is a bit of a mess in my portofolios, it is my first year on the market so my plan is to clean out a bit and stick to a more simple strategy.
@felicegambino4320 Жыл бұрын
HI Great video. I have a quick question that you did not mention. Try my best to be clear as possible."" I bought an ETF for $40, 2 year later I earned 0.80 cents as total of $40.80 but current market is down and ETF is available to for $30. How it works ?"" as nobody will pay my gain as currently I have $30.80. At the end of all I did get how we get the money.
@Emil_E13 2 жыл бұрын
Great video! Is there an easy way to switch from accumulating to distributing Vanguard ftse all world (besides selling and rebuying the other one)? Let’s say in 10 years time the person decides that receiving dividends will be needed.
@AngeloColomboFi 2 жыл бұрын
Hey Emil, the easiest solution would be to just sell 1,5%-2% per year, basically the yearly dividend yield that the ETF reinvests for you. I'm sure you could automate that to simulate the dividend payout.
@Dodinhoism 2 жыл бұрын
Hi Angelo, one question. When you were buying acc ETFs, the Fund does not actually create any dividend and therefore it does not fall on your account by end of quarter or year, you probably just get more ETFs? In opposition to the distributive version, where the dividend is created and paid out. I live in Sweden and wanted to know if I would incur on any tax on that process. The tax here answered me that as long as the dividend money does not hit my account, there is no trigger.
@Dodinhoism 2 жыл бұрын
And thank you for all the good contents.
@mrj5417 Жыл бұрын
Well done !
@AngeloColomboFi Жыл бұрын
Thank you!
@mashanti_worldwide 2 жыл бұрын
Very pragmatic explanation
@chrisjohnson6724 2 жыл бұрын
Hi Angelo, good point regarding what to do when markets go up and down, what's your opinion on a equal weight global ETF? Does Vanguard have one too?
@AngeloColomboFi 2 жыл бұрын
Hi Chris, I don't think equal weight ETFs provide much benefit. Not only do they cost more in fees, but they also seem to underperform their market cap weighted counterparts. Here's the ACWI for example (very close to the Vanguard FTSE All-World): www.msci.com/documents/10199/40b931ce-560e-4851-9b7f-f780e745453c I don't know if Vanguard offers any in Europe, you could check justetf.com
@efraimsideratos Жыл бұрын
I love your videos 🎉
@vraj1111 2 жыл бұрын
Hi Angelo, Great video. Really appreciate all your work. Question: Do I pay taxes on the accumulating ETF even if I dont sell? Or there are no taxes until I hold? I have been trying to understand but could not get a clear picture. Thanks anyway. :)
@AngeloColomboFi 2 жыл бұрын
Thank you Vraj! Depends on your own country's tax laws, so make sure you check :)
@Loostyc 2 жыл бұрын
I think the fund must pay some taxes on dividends unless they reside in a tax haven. 😃
@GabrielIonescuisro 11 ай бұрын
Usually if you don't get dividends and you just buy and no selling, you shouldn't report anything, but like Angelo says, check you country legislation.
@kyf_ Жыл бұрын
Hello, you're video was really helpful, but i have a couple of questions. Using DEGIRO and investing into an accumulating ETF... how does the eft reinvest the dividends, when the amount of dividends that i get is way less than a share's price, combined with the fact that in DEGIRO you can't buy fractional shares. And question number two is, where can i see the amount of dividends that I'm getting... i've been monthly investing in an accumulating ETF for about a year now, using DEGIRO. I would really appreciate it if you gave me some lights here!!
@AngeloColomboFi Жыл бұрын
It all happens within the ETF throughout the entire year, which is why you'll never notice it directly. They're simply reinvested within the ETF to purchase more shares of the stocks within the index, increasing the ETF share value by that amount vs. the Distributing version which pays those out to your brokerage account instead. The performance is exactly the same as the Distributing version incl. paid out dividends, but you don't have extra fees or higher taxes reinvesting them yourself. You can see those dividends here to give you an idea of the amount: www.justetf.com/en/etf-profile.html?query=IE00B3RBWM25&groupField=index&from=search&isin=IE00B3RBWM25#dividends
@vvvblack7893 2 жыл бұрын
can someone please explain to me How the acumulating fund works. They say this type of fund is going to reinvest the dividends. does that mean I am going to get more units in the fund therefor my money would increase. Or the price of the units is the only Factor that would benefit from the reinvesting.
@AngeloColomboFi 2 жыл бұрын
When the stocks within the accumulating ETF pay dividends, the fund uses them to buy more shares of the stocks within the ETF, instead of paying them out to investors. Thus the total yearly returns of the accumulating version and the distributing version (incl. dividend payments) are the same, while the accumulating ETF share value additionally grows by the dividend amount.
@MrJepfs Жыл бұрын
Hi Angelo! Thanks for the video! Do you know if it it possible to transfer from an accumulating to a distributing etf without having it be considered a sale, thus avoiding taxes? If that is the case, I guess the ideal would be to buy accumulating etfs until you need the cashflow
@AngeloColomboFi Жыл бұрын
You're very welcome! Sadly no, but with brokers now having fees of around 1-2€ (eg. Interactive Brokers or Trade Republic) even when buying/selling higher amounts at once, there's no reason why you couldn't just sell 2% of the accumulating ETF per year (or when needed), to simulate paid out dividends (which were reinvested within the ETF instead).
@marcellomantero7317 Жыл бұрын
@@AngeloColomboFi Hey Angelo, thanks a lot for this helpful video. I was wondering if you had two seconds to explain this: Once your dividends are paid to you (from a distributing etf), do you get them in cash? I currently use trade republic and was wondering if the liquidity would simply appear on your balance. Thank you so much for the time and keep it up. Your videos are truly amazing!
@_el.guapo_ 2 жыл бұрын
5:40 Do you mean some counties treat accumulated dividends as taxable event? Is there an accumulated version of the Nasdaq ETF ?
@AngeloColomboFi 2 жыл бұрын
Some countries still tax part of the dividends that were reinvested within the ETF as if they had been paid out to you. It really depends on your country's tax laws, so it's impossible to generalize. Of course, this one by iShares for example: www.justetf.com/en/etf-profile.html?query=Nasdaq++100&groupField=index&distributionPolicy=distributionPolicy-accumulating&from=search&isin=IE00B53SZB19#overview
@KazuyiaMishima 2 жыл бұрын
hello Angelo. I am a fan of Acc. ETfs, however i see no clear advantage of Acc over Dist when talking about FTS World. VWCE & VWRL have almost identical progress. How do they (Vanguard) reinvest your dividents?
@AngeloColomboFi 2 жыл бұрын
They reinvest them into more shares of the companies in the index at certain intervals. You can easily spot the difference if you compare the price performance (excluding dividends in the Dis. Version). Last 12 months: +27,02% Distributing, +29% Accumulating
@KazuyiaMishima 2 жыл бұрын
@@AngeloColomboFi thanks for your detailed reply. how do you check the progress of these etfs. I use justetf and the progress is almost identical.
@marijalisicyna7082 Жыл бұрын
Thank u
@vanessaroseropinto5843 2 жыл бұрын
Hello! one question, is Distributing and accumulating, the same as passive and active ETFs? please help!!
@AngeloColomboFi 2 жыл бұрын
No, I only talked about passive ETFs in the video. These all just passively track a stock market index (eg. S&P 500, FTSE All-World, MSCI World) and have extremely low costs. An active fund would select what stocks to buy/sell individually, based on a fund manager's opinion (which leads to worse performance 90% of the time) and charges much higher fees.
@DiogoPereira-pe4ew Ай бұрын
Hey Angelo I also follow a Acc investing strategy. However there’s something related to what you said that I keep not grasping. When you have this kind of strategy, I never can see what actually was reinvested and my number shares never change. I believe that is because I have shares of the etf and not of the companies inside it. But still would be nice to see the reinvestment happening somehow. Is that possible? Thank you
@AECH_CH 8 ай бұрын
Very good point btw. In Switzerland it's a 0 sum game - you pay the exact same taxe amount (they basically assume a fake dividend payment that gets taxed at your income tax rate - and this fake payment usually is the exact same amount like the distributing version of the ETF). The only saving potential in Switzerland would be the transaction fee, but with a broker like IB it's not even really worth mentioning, since it's almost free.
@AngeloColomboFi 8 ай бұрын
Thank you! Yes, in Switzerland it makes very little difference which version you choose tax-wise.
@pedro.dgouveia Жыл бұрын
Hello, great video but I have 1 question. How do you see the returns from accumulating etf? Does your stock go up in value?
@AngeloColomboFi Жыл бұрын
Thank you! Yes, historically your ETF shares of popular indexes like the FTSE All-World or MSCI World tend to go up in value over time, as the stocks contained in the index increase in value and dividends are reinvested into more shares of the stocks.
@nekobox Жыл бұрын
@@AngeloColomboFi then how come the distributing version of FTSE All-World is currently priced higher? Over which time scale are we talking about before you would see a noticeable difference between the accumulating and the distributing? I'm new to this and just trying to understand, thanks :)
@Dusan698 5 ай бұрын
The dividends are reinvested immidiately in accumulating ETF? Let's say, on Monday, Vanguard recieve dividend from Amazon and reinvested immidiately on Monday or Tuesday or reinvested monthly? quarterly?
@funaroundmobile4599 10 ай бұрын
Hi, nice video! I have a question- how often the Accumulating etf is actually acummulating itself? Is it daily, monthy, yearly? How to check it? And is it different for different accumulating etfs or same for all? Thanks
@AngeloColomboFi 10 ай бұрын
That's spread out across the entire year, there are no fixed dates. It's reinvested as soon as the stocks within the ETF (eg. over 3.600 from all across the world in the FTSE All-World) pay out their dividends at different times.
@funaroundmobile4599 10 ай бұрын
I see, thanks. And what it means it's reinvested, could you elaborate more on that? That it's buying new fractional part of the second etf which I didn't have before or? Could you show example with some numbers? Like let's say I bought 1 vanguard AllWorld etf for the price of 100euros. After a year I have let's say 110e, what does it mean? Is it 10e a fractional party (1/10) of a second etf which I now own, or my current one now is worth 110e(but then who would buy it from me for 110e if let's say market price is still 100e)? Thanks
@chang.07 Жыл бұрын
If I were to pick distribution, but reinvest in the ETF when it’s paid out. Would compounding interest still work the same as accumulation? I’m struggling to find some ACC ETFs, so I’ll just go with DIST
@AngeloColomboFi Жыл бұрын
There would only be small differences because of the timing when dividends are paid out to you and when you reinvest them, yes. The one thing to research regarding your home country is taxation - in many countries, accumulating ETFs are taxed more favorably during the holding period, so that's something to keep in mind.
@chang.07 Жыл бұрын
@@AngeloColomboFi thank you. This was helpful
@user-ey9pl2nn6g 7 ай бұрын
Hi, I am new in the ETF investing and I am wondering why the Vanguard FTSE All-World Accumulating and Distrusted etfs have identical performance returns since 2019? I thought that by reinvesting the dividends in more stocks the Accumulating version should outperform the returns. Can someone explain it to me?
@AngeloColomboFi 7 ай бұрын
The performance you see on JustETF when comparing the two includes paid out dividends, as if you had reinvested them without paying taxes. That's why.
@jonathanponce1575 2 жыл бұрын
Hi! How can i change from Distributing to Accumulating ETFs?
@AngeloColomboFi 2 жыл бұрын
If your existing distributing ETF shares are in profit, I would keep them and simply buy accumulating shares from now on.
@masoodhamdard5187 Жыл бұрын
Could u pls write us the MSCI world ISIN number; am just confused of chosing the best MSCI for invensting.
@AngeloColomboFi Жыл бұрын
Hey Masood, here's an updated version: kzfaq.info/get/bejne/nb1-fduCq7SYhaM.html I put all the ISINs in the video description.
@nalusan 2 жыл бұрын
In germany at least there is the point of taxes, that makes distribution etfs better up to the Personal yearly tax free amount.
@andreeas1939 2 жыл бұрын
Hello, I'm using xtb broker and I only have the accumulating option for EUR of VWCE. Is that the same? I see you're using the dollar one.
@AngeloColomboFi 2 жыл бұрын
Hi Andreas! Yes, that's the same ETF :) I also buy it in EUR
@andreeas1939 2 жыл бұрын
@@AngeloColomboFi thanks 😊
@ondrejvaclavik 2 жыл бұрын
@@AngeloColomboFi Hello, XTB also has VWRA, shouldn't it be accumulating version in USD?
@ambroochizafer 2 жыл бұрын
Greetings Angelo. 😌.. Whats ur take on fund robots.. (pertaining to Sweden or Belgium )
@AngeloColomboFi 2 жыл бұрын
Hi Zafer, you should know that you're paying them higher fees for the convenience of choosing stocks/ETFs for you. I would also compare their performance over a long time-frame vs. the MSCI World or Vanguard FTSE All-World. You'll likely save quite a bit of money and be better off buying ETFs yourself over the long run.
@ambroochizafer 2 жыл бұрын
@@AngeloColomboFi excellent answer always. 😌.. I use lysa in Sweden and they do invest in vanguard etc with a total fee amounting to 0,30-0,41%. I plan to move to Belgium 🇧🇪 and I haven't found any good fundrobot yet. etfmatic and degiro are the only ones I know of.
@AngeloColomboFi 2 жыл бұрын
Ok, those fees are not too bad :) Sure, you could try alternatives like ETFmatic if you prefer investment robots, or set up a simple ETF strategy yourself. In the end you should do whatever you feel most comfortable with long-term.
@comedyman112 2 жыл бұрын
If I invested all my life in an accumulating ETF, how do I enjoy my dividend money once I reach the retirement age? I must simply sell all my Accumulating ETF portfolio (example VWCE) and buy Distributing (example VWRL)? What if there's a market crash?
@AngeloColomboFi 2 жыл бұрын
The ETF is still receiving dividends from the stocks within it, it just reinvests them for you. You could just pretend you're receiving them by selling about 2% of the accumulating ETF every year. That's not an issue anymore now that trading fees are so low or even free in some cases. A market crash affects the distributing ETF the same way.
@rafhadalto 11 ай бұрын
My question would be how practical os migrating from Accumating to distributing after retirement
@AngeloColomboFi 11 ай бұрын
Why would that be needed though? Fees are so low nowadays (eg. 1,25€ on IB: angelo.fi/ibkr ), you can just sell accumulating shares whenever you want dividends to be paid out. You could even sell the exact same amount in % that the distributing version pays out and that would almost have the same effect
@soniaconceicao1895 2 жыл бұрын
It seems to me that distributing ETFs are better. But actually, that only depends on each person's needs and strategies.
@AngeloColomboFi 2 жыл бұрын
They're definitely easier psychologically. Yes, there's nothing wrong with going either way!
@tr.gotti. 10 ай бұрын
If you own not many ETF’s and receive a small amount of dividend, how can it reinvest the dividends if the amount is lower than the cost of 1 ETF? Regardless of distributing or accumulating.
@AngeloColomboFi 10 ай бұрын
The accumulating ETF does it for you within the fund, no matter how many shares you have or the value of your shares. With a distributing ETF that's true, you would need a certain amount of paid out dividends before you can reinvest them yourself. You could just add that money next time you're planning to invest though as an alternative.
@romansnekrutenko8143 2 жыл бұрын
Hey Angelo! Thanks for the video! Couple of questions here: Is ETF that you buy EU based, so you don’t need to fill double taxation form? How painful conversion fee (EUR-USD) is with Degiro for each 1K EUR you invest?
@catalin2371 2 жыл бұрын
He buys Vanguard FTSE All World which is based in Ireland , so EU based. Currently you can buy it under 3 currencies USD, EU or GBP depending from where you buy it, so no need to worry about conversion on your broker. If you live in Europe and you choose the distributing one, probably you will have to play taxes for dividends , since Ireland has 0% taxes , as far as I know. Cheers
@AngeloColomboFi 2 жыл бұрын
My pleasure! Yes, it's domiciled in Ireland, as they have an advantageous tax treaty with the US. No, I've never had to do that. I only traded directly in Euros so far on Degiro, but the conversion rates on USD dividends have been very good!
@AngeloColomboFi 2 жыл бұрын
Yes, you need to pay taxes on capital gains or dividends according to your own home country's tax laws.
@centrino538 2 жыл бұрын
@@AngeloColomboFi In fact it depends on your country. In Belgium, there are no taxes on capital gains. Only on dividends. That's why I buy the Accumulation version 😇
@AngeloColomboFi 2 жыл бұрын
Sweet, then it's an easy decision for sure! Btw, I had no idea you were based in Belgium, nice :)
@ianmckinney3446 Ай бұрын
One thing I don't understand is who owns the extra shares in a accumulation etf, does it go straight into your own shares giving you more?
@AngeloColomboFi Ай бұрын
The ETF buys more shares of the stocks within the index on an ongoing basis as dividends are paid by stocks, raising the value of your ETF shares by that amount.
@ianmckinney3446 Ай бұрын
@@AngeloColomboFi so the index owns the shares bought by my dividends? The difference between the gains of both types is minimal, in fact in some cases hardly noticeable, so surely distributing is better because you end up with more shares in the long run.
@AngeloColomboFi Ай бұрын
No, you own your part of the ETF proportional to your investment. Not true, the total return is the same as when dividends are paid out and reinvested by you, but the latter is less tax efficient in most cases and you pay more in trading fees
@shyngysbek6907 6 ай бұрын
I have a question. How can I switch from accumulating ETF to distributing ETF after investing 10 years to start getting passive income? Selling all acc ETF and buying the same ETF with distributing?
@AngeloColomboFi 5 ай бұрын
Why do you need "passive income"? It's a lot more tax-efficient to just sell accumulating shares instead when you need the money. I'm planning to do the same in retirement: kzfaq.info/get/bejne/mMWEi9RqrZ7UooU.html
@herodotoioannou612 2 жыл бұрын
I seem to come at a dead end on choosing to go with accumulating or distributing etfs. So in the long run (15+ years) if i want to have income from my portfolio, i have to sell shares of my accumulating etf. But if i reinvest the dividends manually for 15 years (distributing etf) then when i want to have my income everything is setup.
@herodotoioannou612 2 жыл бұрын
What is your opinion on this? (Not legaly binding, just personal opinion.)
@herodotoioannou612 2 жыл бұрын
Btw thank you for the videos. I find your channel very useful!
@AngeloColomboFi 2 жыл бұрын
Hi Herodoto, Since fees on brokers are becoming lower and lower, there's a good chance you won't have any fees when selling ETF shares in 10-15 years. Thus in retirement, you could simply sell 1,5-2% of your shares per year, to simulate yearly dividend payments. It would have the same effect as the distributing version, while being a lot more tax efficient for the entire period where you don't need the dividends to fund your lifestyle. It also saves you the work/fees of having to reinvest them regularly for the next 10+ years.
@centrino538 2 жыл бұрын
Thanks! That's why I have : 1- a dividends portfolio of stocks, AND 2- an Accumulating ETF, for tax optimization 😇
@AngeloColomboFi 2 жыл бұрын
Nice combo! I also enjoy the dividends we get from our existing (pre-2021) Distributing ETF shares :) Maybe a mix of the two is not a bad idea.
@Dodinhoism 2 жыл бұрын
I am not sure I understand what tax optimisation means. I am reading under JustETF that accumulative ETFs are also taxed...
@user-mb7nf3nn9j 11 ай бұрын
Bro, let's say you have an accumulating version for 10 years and want to convert to the distributing version, is that possible?
@AngeloColomboFi 11 ай бұрын
No, but it's not necessary anyway to switch to the Distributing version just to have dividends paid out in cash. Nowadays you pay only 1-1,25€ in trading fees, so it's easier to just sell a small portion if needed - you could even just sell 2% per year to simulate dividend payments
@Karma85858 4 ай бұрын
what if I invest in both dist and acc s&p 500?
@AngeloColomboFi 4 ай бұрын
Nothing wrong with buying both versions!
@Karma85858 4 ай бұрын
@@AngeloColomboFi but because I dont have much money to invest every month I decided to go with acc, do you think thats worth it to go 100 acc or 50/50 would do the same results even with low amount of money?
@AngeloColomboFi 4 ай бұрын
I would just pick the Acc. version then. And if you're in Hungary (based on your name), look into TBSZ accounts on IBKR, where capital gains are tax-free after 5 years: angelo.fi/ibkr I mentioned it in this recent video as well: kzfaq.info/get/bejne/qcWFfpaflra6eKc.html
@ronnysoto2086 8 ай бұрын
How are investors benefiting from compounding in an accumulating ETFs if they are not receiving additional shares of the ETF itself? The dividends are re-invested in the shares of the companies the ETF holds but the investors don't get additional shares of the ETF...
@AngeloColomboFi 8 ай бұрын
The value of your ETF shares increases by the amount that's reinvested into the stocks within the index when dividends are paid. Since this happens throughout the entire year, you simply don't notice it as clearly.
@assosecco 8 ай бұрын
Angelo sei il numero 1
@AngeloColomboFi 8 ай бұрын
Grazie! 😅
@teamskovhugger8135 11 ай бұрын
🤔 a ACC etf reinvest the returns into the stocks within the etf AND this speed up the snowball effect very much . A Dist etf are very motivating agree but in my cuntry it is not smart because of tax .
@creativemind74 6 ай бұрын
In Portugal, the state steals 28%. The right choice is the accumulated and reinvested dividend. On the other hand, I prefer to prioritize ETF performance.
@AngeloColomboFi 6 ай бұрын
Thanks for sharing! Austria is almost the same (27.5%)
@bluelindgren7569 Жыл бұрын
I like to have both for veraity
@AngeloColomboFi Жыл бұрын
Sure, why not! I also kept my existing distributing shares
@Luke_Lucas 2 жыл бұрын
DeGiro unfortunately doesn't accept potential investors from several nationalities even though they are based in Europe.
@jagos9376 3 ай бұрын
Nach deinen Videos kenn ich mich nun nicht mehr aus, wollte eig. in DIST ETFS (Vanguard FTSE ALL-WORLD) investieren, aber anscheinend läuft das über Irland und man zahlt 41% Steuern ?!?! 😅
@mf____ 2 жыл бұрын
Degiro is pretty nice. Too bad they don't have joint account.
@VojtechMach 6 ай бұрын
Came here to get another view on dividend investing but I am still convinced it is suboptimal. At least in my country, your dividends are taxed by 15% (this number may change with political situation in future decades). That is your hard-earned money you just give away for no reason. The Acc index will reinvest the dividends without this tax (I believe so) and you can come the other day and withdraw those 2% of your portfolio yourself without getting taxed if it is a long-term investment. In my book, the only upside of the Dist etf is the automation, but then again, you can also automate this even in the Acc version, so not really a benefit. Also I dont understand the mention about selling in a bear market. Im not sure how dividend amount is determined exactly, but if it is calculated as % of a stock price, it means bear market will decrease your dividend payout significantly anyway. I dont see any true benefit. Am I missing something?
@AngeloColomboFi 6 ай бұрын
I agree, the benefit is only psychological. With low fees of around 1€ per trade using the best low-cost brokers in Europe, you can always sell shares of your accumulating ETF when needed, even in retirement.
@karsinds 10 ай бұрын
I prefer always distributing etf
@AngeloColomboFi 9 ай бұрын
Nothing wrong with that!
@thehafinator749 2 жыл бұрын
Unfortunately, Degiro doesn't like Slovenia, so no account for me :(
@Luke_Lucas 2 жыл бұрын
I'm on the same boat!
@iggysmalls344 2 жыл бұрын
Hi Angelo, a quick question.. What is the European equivalent to a Roth IRA? I didn`t manage to find anything.. I live in Austria as well if that helps a bit? Many thanks ^_^
@AngeloColomboFi 2 жыл бұрын
Hi Iggy! Sadly we don't have anything like that in Austria :/
@adalat7019 2 жыл бұрын
@@AngeloColomboFi is Isa same as Roth?
@oliverosp7183 Жыл бұрын
"Let's imagine it's 2022 and the stockmarket crashed 30%" Well well well
Investor Center
Рет қаралды 621 М.
PerFinEx
Рет қаралды 7 М.