I'm shooting for an 80/20 portfolio which has therefore resulted in my 401k being full of bonds.
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Any advice? Does anyone keep bonds in their taxable account?
I skimmed that article, and the one mentioned by a poster above, and I think a hybrid approach in both accounts might work better. Meaning, have almost all stock in taxable, and almost all bonds in your 401k. I'm going to assume you have a Traditional 401k.
First your concern about no bonds in taxable. Respecting that concern, I'd recommend you look at Vanguard Tax-Exempt Bond ETF (VTEB). The bonds are exempt from Federal taxes, so it doesn't matter what state you live in (CA and NY have state-specific funds that offer state tax-exemption). And because I don't know your brokerage account, I mentioned an ETF that can be purchased anywhere just like a stock: with symbol "VTEB". You will need to determine what portion of taxable you want for bonds, depending on how long you think a stock correction could last and your expenses.
For a Traditional 401k, it's better to mostly have bonds. It's important to know you will eventually pay ordinary income tax on the Traditional 401k. Bond income already incurs ordinary income tax, so it's no different. Stocks get most of their benefit from long-term growth and dividends - both of which have tax advantaged rates. Putting stocks in a Traditional IRA or 401k elects for a higher tax rate. But there's a subtle point that people not thinking outside the box can miss: you decide what goes in a Traditional 401k, and you decide what gets taxed later. If you put slower growing bonds in there, you will probably pay less taxes because bonds aren't expected to keep up with stocks. So another reason I'd recommend a 401k hold mostly bonds is that you are electing to be taxed on slower growing assets, and so electing to pay less tax.