Tax-Efficient Investing Strategies
Investing with Taxes in Mind
It’s not just what you earn—it’s what you keep
Investment returns can be diminished by taxes if your portfolio isn’t structured thoughtfully. That’s why we incorporate tax strategy into every investment decision we make. From how your dividends are taxed to when and where we place your assets, we aim to optimize your after-tax returns at every stage of your financial journey.
Asset Location
Place the right investments in the right accounts
Asset location is one of the most effective ways to increase tax efficiency without changing your overall investment strategy. It’s about placing tax-efficient investments in taxable accounts and tax-inefficient ones in tax-advantaged accounts—so you keep more of what you earn.
- Tax-Efficient Funds in Taxable Accounts: We often place index funds and ETFs in brokerage accounts because they generate fewer taxable events.
- Taxable Bonds in IRAs or 401(k)s: Interest income from bonds is taxed as ordinary income, so holding them in tax-deferred accounts can reduce your annual tax bill.
- REITs and Alternatives in Tax-Deferred Accounts: These investments may throw off significant income that’s better sheltered in a retirement account.
- Growth Assets in Roth Accounts: Investments with high growth potential are often ideal for Roth IRAs, where qualified withdrawals are tax-free.
This type of coordination can materially improve your after-tax returns over time.
Tax-Loss Harvesting & Rebalancing
Offset gains and keep your strategy on track
When markets dip, we don’t just wait—we look for opportunity. Tax-loss harvesting involves selling investments at a loss to offset taxable gains elsewhere in your portfolio, potentially lowering your tax bill. At the same time, we rebalance your portfolio in a tax-conscious way, avoiding unnecessary capital gains while keeping your asset allocation aligned with your plan. This discipline adds long-term value, especially in volatile markets.
Managing Capital Gains
Smart timing for lower tax impact
Capital gains can be minimized with the right strategy. We focus on long-term holding periods to benefit from lower tax rates, and may recommend delaying sales until a lower-income year or using appreciated securities for charitable giving. These strategies help you control when and how much tax you pay, keeping more of your wealth working for you. We coordinate these moves with your tax advisor to ensure every decision fits into your broader plan.
Tax-Advantaged Investments
Leverage accounts and strategies designed to reduce taxes
We help you take full advantage of tax-preferred investment options. This includes maxing out retirement accounts like 401(k)s, Traditional and Roth IRAs, and even using Health Savings Accounts (HSAs) or 529 college savings plans when appropriate. We may also incorporate municipal bonds in taxable accounts for high-income earners, as they generate tax-free interest at the federal—and sometimes state—level. Every recommendation is tailored to your income, tax bracket, and long-term goals.
