Maximizing Returns: Strategic Investment Strategies and Tax Optimization

“We’ve all heard Benjamin Franklin’s famous quote “Nothing is certain except death and taxes’. This sentiment is certainly as true today as it has ever been! If you’re making money, uncle Sam will always find a way to claim a piece of the pie – and this carries over to investing, where growing your money is the name of the game. So, inevitably, if you want your investments to grow, there is no real way around triggering some tax consequences somewhere along the way. If you want a nice big juicy delicious burger, you have to accept the calories and fat that come along with it - similarly healthy growth in your portfolio will also bring tax consequences by its very nature.

 We can’t let taxes dictate our investment approach - similar to how a low-calorie veggie burger just doesn’t taste the same, letting your investment approach be dictated by minimizing taxes leads to missed opportunities to grow and an inability to manage the risk exposure of a portfolio. The end result is a portfolio that fails to perform the way that they should.

 Now, that doesn’t mean we should just ignore tax consequences either! Investors who make this mistake can end up triggering more taxes than are necessary to get excellent financial returns. 

We are always keeping a keen eye on the tax implications of our investment and trading in an attempt to strike the best balance. 

 Even when growth opportunities clearly outweigh the tax consequences, we still look to manage the taxes by utilizing tax strategies such as tax loss harvesting, and by spreading the realization of significant gains across multiple tax years! This holistic, weighing and balancing approach is called portfolio optimization. This approach allows us to keep the risk, return, and tax consequences of our portfolio decisions in context to help us uncover the best path forward for your investments.  Keep

In mind that even tax loss harvesting strategies have limited benefit especially in years like this when the market has been so strong and portfolios are showing excellent returns. 
While we’ve tried to minimize taxes in a year like this, there have been moments where we’ve found it necessary to make changes to your allocation. The market has hit all-time highs repeatedly in 2024 and following the basic rule of buying low and selling high we have systematically harvested gains this year. As a result, don’t be surprised if your taxes are slightly higher due to the welcomed growth of your portfolio.

Remember, as always if you have any questions about this or other financial topics affecting your life at the present, please reach out to us at 518-406-5624. Bye for now!”