Active Tax Management
With our investing philosophy, by and large, we recommend a set it and forget it mindset as it relates to your investment plan, which generally doesn’t benefit from excess activity. Tax planning, on the other hand, offers more frequent opportunities to actively add value (even above and beyond the extreme tax-efficiency of the investments themselves).
Here are three examples:
1. Guiding the sequence of additions to your various accounts during your career and, likewise, ensuring that withdrawals are taken in proper order from those accounts in retirement
2. Matching the right type of asset (equity, fixed income, real estate) with the appropriate account registration (be it taxable, tax-deferred, or tax-exempt)
3. Making creative suggestions based on our understanding of your situation and goals (i.e. IRA contributions, Roth conversions, charitable giving)
As the CPA on the team, I can assure you that we all work together to minimize the impact of taxes on your portfolio and maximize opportunities to leverage tax planning. Tax sensitivity is one of the things that helps us support you in your goals.
Watch in future newsletters for detailed discussions on each of the items listed above.