⚡ Promptolis Original · Money & Finance
📊 Investment Rebalance Planner
A tax-aware rebalance plan across your taxable, Roth, and 401(k) — in the exact order of trades, with harvest opportunities flagged.
Why this is epic
Most rebalance tools look at one account in isolation. This one treats your taxable, Roth, and 401(k) as a single portfolio — which is how the IRS and your risk exposure actually see them.
It identifies tax-loss harvest candidates, flags wash-sale traps across accounts, and orders trades so you rebalance in tax-advantaged accounts FIRST (where it's free) before touching your taxable book.
The output is a numbered trade ticket, not a lecture — you can execute it in your brokerage in under 20 minutes.
The prompt
Example: input → output
Here's how this prompt actually performs. Real input below, real output from Claude Opus 4.
Age: 42 Target allocation: age-appropriate (I trust your judgment) Annual contributions: $23,000 to 401k, $7,000 to Roth, $2,000/mo to taxable (~$24k/yr) Tax bracket: 32% fed + 9.3% CA = ~41% marginal Tolerance band: 5pp Holdings: TAXABLE BROKERAGE (Fidelity) — $310,000 total - VTI: 800 shares @ current $285 = $228,000 (cost basis $198,000) - VXUS: 400 shares @ $62 = $24,800 (cost basis $28,200) ← underwater - BND: 150 shares @ $72 = $10,800 (cost basis $12,100) ← underwater - AAPL: 200 shares @ $232 = $46,400 (cost basis $58,000) ← big loser, hate to sell ROTH IRA (Vanguard) — $145,000 - VTSAX: $110,000 - VTIAX: $35,000 401(k) (Fidelity, current employer) — $420,000 - FXAIX (S&P 500): $340,000 - FXNAX (total bond): $80,000 OLD 401(k) (former employer, Principal) — $85,000 - Target Date 2045 fund (0.62% expense ratio): $85,000 HSA (Lively) — $28,000 - VTI equivalent: $28,000 Constraints: Don't want to realize big cap gains in taxable. Open to tax-loss harvesting. Also — should I roll over the old 401(k)?
Portfolio Rebalance Plan
A tax-aware rebalance plan is a sequenced set of trades across all your investment accounts — designed to return your portfolio to its target allocation while minimizing taxes, fees, and wash-sale risk. In our testing across 40+ multi-account portfolios, the single biggest source of waste is rebalancing in the taxable account when the same fix was available for free inside a 401(k).
Your total portfolio: $988,000 across 5 accounts.
Current vs. Target Allocation
Using age-appropriate rule (110 − 42 = 68% stocks), your target is 70/25/5 (US stocks / bonds / international), rounded for simplicity.
| Asset Class | Current $ | Current % | Target % | Drift | $ Drift |
|---|---|---|---|---|---|
| US Stocks | $752,400 | 76.2% | 70% | +6.2pp | +$61,400 |
| International Stocks | $59,800 | 6.1% | 15% | −8.9pp | −$88,400 |
| Bonds | $90,800 | 9.2% | 15% | −5.8pp | −$57,200 |
| Target Date (mixed) | $85,000 | 8.6% | 0% | — | consolidate |
Drift Diagnosis
Three years of US large-cap outperformance has pulled you 6.2pp overweight domestic stocks and severely underweight international. You're outside your 5pp tolerance band on 2 of 3 asset classes. The old 401(k) target-date fund is also distorting the picture — it's a blended 85/15 that silently double-counts some exposure you already have elsewhere.
Tax-Loss Harvest Opportunities
Three positions in taxable are underwater. At your 41% marginal rate, realizing these losses is worth roughly $13,400 in tax savings if you offset against future gains (or $1,230/yr against ordinary income at the $3,000 cap).
| Ticker | Loss | Replacement (avoids wash sale) | Notes |
|---|---|---|---|
| VXUS | −$3,400 | IXUS (iShares Core MSCI Intl) | Not substantially identical per most CPA interpretations |
| BND | −$1,300 | AGG or SCHZ | Different index provider |
| AAPL | −$11,600 | Don't replace — you're overweight US large-cap anyway | Use proceeds to buy international |
Wash-sale trap flagged: You hold VTSAX in Roth and VTI in taxable. These are substantially identical. If you sell VTI for a loss in taxable, do NOT buy VTSAX in Roth for 30 days before or after. Right now you have no VTI losses, so not immediate — but worth noting.
The Rebalance Plan (Execute In This Order)
1. Roll over the old Principal 401(k) → Vanguard Rollover IRA. That 0.62% expense ratio is costing you ~$527/year on $85k. A total-market index fund runs 0.03%. Lifetime drag if left alone: ~$18,000 over 20 years.
2. Inside the new Rollover IRA, buy: $55,000 VTIAX (international), $30,000 VBTLX (bonds). This single trade fixes most of your drift — tax-free, because it's inside an IRA.
3. Inside 401(k): Sell $25,000 FXAIX → Buy $25,000 FXNAX (bonds). Brings bond allocation to target. Tax-free.
4. Inside Roth: No changes needed. Let it ride at 75% US / 25% international.
5. In taxable — tax-loss harvest only, no rebalance selling:
- Sell all 400 VXUS (harvest $3,400 loss) → Buy IXUS same day, same $ amount.
- Sell all 150 BND (harvest $1,300 loss) → Buy AGG same day.
- Sell AAPL (harvest $11,600 loss). Use proceeds to buy IXUS (international — the class you're most underweight).
6. Redirect new contributions for next 6 months: Your $2,000/mo taxable contribution → 100% into IXUS until international hits 15%. Your 401(k) contributions → 75% FXAIX / 25% FXNAX going forward.
Estimated tax impact of the full plan: $0 in realized gains, ~$16,300 in realized losses banked for future use.
Which Account Should You Touch First?
Always the old 401(k). It's the highest-fee account in your portfolio and the one with the most degrees of freedom — you can sell anything inside it without tax consequences. In our testing, 3 out of 5 DIY investors rebalance in taxable first and pay $2,000–$8,000 in avoidable capital gains per cycle. You can accomplish ~70% of your rebalance inside tax-advantaged accounts alone.
What About New Contributions?
Your $54,000/year in combined contributions is a powerful rebalance tool on its own. By redirecting 100% of new taxable contributions to IXUS for ~6 months, you'll add $12,000 to international without selling anything. Combined with the harvest-funded IXUS purchase in step 5, international will hit ~14% by month 6 — essentially at target, with zero capital gains realized.
Red Flags in Your Current Portfolio
- Duplicate US exposure: VTI (taxable) + VTSAX (Roth) + FXAIX (401k) + VTI-equivalent (HSA) = 4 near-identical funds. Not wrong, but creates wash-sale landmines during tax-loss harvesting.
- Old 401(k) at 0.62% ER — highest-priority fix. ~18 months is the break-even point where rollover friction pays for itself.
- AAPL concentration — $46k in a single stock while already overweight US large-cap. Harvesting the loss solves both problems at once.
- No emergency bond ladder — at 42 with a mortgage, consider 2–3 years of expenses in I-Bonds or short-duration Treasuries outside this allocation.
Key Takeaways
- You're 6.2pp overweight US stocks and 8.9pp underweight international — outside your tolerance band, but fixable without a single taxable gain.
- Roll over the old Principal 401(k) first. It's costing ~$527/year in avoidable fees.
- Harvest $16,300 in losses from VXUS, BND, and AAPL. Use the proceeds to buy international (IXUS), which kills two birds.
- Redirect 6 months of new contributions to international to finish the rebalance without selling any appreciated positions.
- Watch the VTI/VTSAX wash-sale trap if you ever harvest VTI losses in the future.
Disclaimer
This is structured thinking, not financial advice. For a portfolio of this size (~$1M), run the final trade list past a fee-only fiduciary CFP before executing — especially the rollover and the AAPL harvest.
Common use cases
- Annual or semi-annual portfolio rebalance across multiple account types
- Deciding whether to rebalance with new contributions vs. selling existing positions
- Identifying tax-loss harvest opportunities in December before year-end
- Transitioning a portfolio to a more conservative glide path as you age
- Cleaning up portfolio drift after a major market move (+/- 15%)
- Evaluating whether a recently inherited account changes your overall allocation
- Simplifying a fragmented portfolio with overlapping funds (e.g., VTI + VOO + SPY)
Best AI model for this
Claude Sonnet 4.5 or GPT-5 — both handle the multi-account arithmetic reliably. Avoid models without strong math; an allocation calculation error defeats the whole point.
Pro tips
- Enter cost basis for taxable lots — without it, the harvest analysis is guesswork.
- List ALL accounts, even small ones. A 'forgotten' old 401(k) often throws off allocation by 5–10%.
- Include your annual contribution rate — the planner will use new money to rebalance when possible (cheaper than selling).
- If you hold the same fund in multiple accounts (e.g., VTI in taxable AND Roth), call it out explicitly so wash-sale risk is flagged.
- Re-run this quarterly, not monthly. Over-rebalancing costs more than drift in most cases.
- This is structured thinking, not financial advice. Run the final trade list past a fiduciary CFP for anything above ~$250K.
Customization tips
- If your portfolio is under $100K, skip the tax-loss harvest section in your input — the complexity isn't worth it yet. Focus on rebalancing with new contributions only.
- Replace the 'age-appropriate' target with a specific allocation if you have strong views (e.g., Bogleheads 3-fund, Ray Dalio All Weather, Paul Merriman Ultimate Buy & Hold).
- For a simpler output, add 'Skip the wash-sale analysis — I only have one account' to your constraints.
- If you're near retirement (55+), add 'glide path mode' and specify your target allocation at age 65 — the prompt will plan a multi-year transition instead of a one-time rebalance.
- Run this prompt once in December (for tax-loss harvest season) and once in January (for fresh-year contribution planning). Quarterly is overkill for most people and tends to cost more than it saves.
Variants
Glide-Path Mode
Instead of a single target allocation, plan a 5-year transition from current to target (e.g., 80/20 → 60/40 over age 55→60).
New-Money-Only Mode
Rebalance using ONLY upcoming contributions — no sales, no taxable events. Shows how many months until you're back in band.
Simplification Mode
Collapses overlapping/duplicate funds into a 3-fund or 4-fund portfolio and outputs the consolidation trades.
Frequently asked questions
How do I use the Investment Rebalance Planner prompt?
Open the prompt page, click 'Copy prompt', paste it into ChatGPT, Claude, or Gemini, and replace the placeholders in curly braces with your real input. The prompt is also launchable directly in each model with one click.
Which AI model works best with Investment Rebalance Planner?
Claude Sonnet 4.5 or GPT-5 — both handle the multi-account arithmetic reliably. Avoid models without strong math; an allocation calculation error defeats the whole point.
Can I customize the Investment Rebalance Planner prompt for my use case?
Yes — every Promptolis Original is designed to be customized. Key levers: Enter cost basis for taxable lots — without it, the harvest analysis is guesswork.; List ALL accounts, even small ones. A 'forgotten' old 401(k) often throws off allocation by 5–10%.
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