High yield vs total market
Compare a high-dividend-yield US fund against a total US market fund with distribution tax character in view.
VYM holds higher-yielding large-cap US stocks, so it distributes more of its return as dividends. VTI holds the total US market at a lower yield, leaving more of its return as unrealized appreciation.
Yearly dividends are taxable in a taxable account, while unrealized gains defer tax until a sale. Run the comparison to see how that timing difference affects the after-tax path for your inputs.
Historical results
Historical results for a $10,000 lump sum with dividends reinvested and monthly rebalancing, as of 2025-12-31. Past performance does not guarantee future results. Not investment advice.
After-tax assumptions: Single filer, $150,000 income, taxable account, HIFO lots, 2026 federal brackets, no state tax.
Run it live with your own dates and tax profileIs a high-dividend fund more tax-efficient?
Usually the opposite in a taxable account. Higher yield means more return is distributed and taxed each year rather than deferred as unrealized gains. The net after-tax effect still depends on total return and your bracket.
Where does a high-dividend fund fit better?
In a tax-advantaged account, distributions are not taxed yearly, so the yield difference carries no annual tax cost. The taxable view is where the difference appears as tax drag.
Run this comparison with your own dates, account type, and tax profile.
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