Are Taxes Hurting Your Investment Returns? How to Build a TaxSmart Portfolio
Effective tax management is under-appreciated by the investment industry, yet constructing a portfolio with taxes in mind may be one of the most significant ways an investor can improve their overall investment performance.
Many investment products, like mutual funds, are incredibly inefficient from a tax standpoint. Your tax situation is not considered by fund managers when buying and selling throughout the year. In addition, new shareholders can be liable for gains in the fund that accrued before their investment and worst of all - other investor's redemptions can trigger taxes you'll owe.
Optimize Across Account Types
Reducing taxes is a real concern for WealthFactor clients, which is why tax efficiency is part of our RiskSmart investment strategy.
Two examples of our tax management strategies are:
1. Cross-account tax management that seeks to optimize the specific tax advantages of various account types, and
2. Constructing index-based portfolios using the underlying stocks. By doing this, we then can manage taxes on an individual security basis for each one of our clients.
These are just two of many tactics we deploy to optimize for overall tax efficiency.
How well is your portfolio optimized for after-tax returns?
Taxes can have a significant impact on portfolio returns, which is why we build client-specific portfolios designed with after-tax total returns in mind.
At WealthFactor, we developed our RiskSmart investment approach to maximize the probability investor outcomes will be successful. We use technology and process to increase portfolio and tax efficiency; while reducing your costs with our low .35% management fee.
Get in touch today if you'd like to keep more of your money and discover how WealthFactor's RiskSmart investing can help achieve your investment goals.
*Important Disclosures and Disclaimers: No assurances can be made that WealthFactor will be able to achieve its investment objectives or avoid losses. WealthFactor is a Registered Investment Advisor. The information on this website is not intended as tax or legal advice. The information on this website is intended for residents of Oregon. This information is not intended to be personalized and as such should not be construed as a recommendation to buy or sell any security or financial instrument, or to participate in any particular investment strategy. WealthFactor is licensed with the State of Oregon and will seek proper licensing or exemption from licensing before conducting business in any state. ADV Disclosure documents available upon request. Click here for additional disclosures. Click here for definitions.