Hey folks, another newbie question. I have a TFSA, RRSP, and individual margin (taxable) account with Questrade that I opened two years ago. Back when I started I didn't treat my three accounts as part of one entire portfolio so that my three accounts had different funds and allocations in each. That has been mostly fixed with my RRSP and TFSA, as both hold the same funds and allocation percentages. However, my margin account, being taxable, has remained the same.
My taxable margin account has three Vanguard funds, VXC, VCN, and VAB. That's my international stock index, Canadian stock index, and Canadian bond index. My problem rises out of the fact that I learned only recently that bonds are not taxable account-friendly, given that their dividends are taxable. I really don't want to pay more in taxes if I can help it.
So my question is, what do I do with these bonds? Do I sell them off to trigger a taxable sale in 2016's tax return in March or April or whenever the 2016 tax season starts and never hold bonds in my margin account again? Or do I just grin and bear it and deal with the taxable dividends for the short term and deal with it in the long term, never buying any more bonds? The market value of my bonds is around $4,300 so we're not talking huge amounts of dividends here, for what it's worth.