How Tax Planning Fits Into Financial Advice

Tax planning is an important part of financial planning that can significantly improve your

net returns and financial efficiency. It goes beyond just filing taxes annually - it's also about

strategizing to minimize tax liabilities and maximize wealth accumulation.

Where Tax Planning Fits In:

Maximizing Tax-Advantaged Accounts

  • Retirement Account Strategy - Contributions to tax-deferred accounts like 401(k)s

and traditional IRAs reduce current taxable income and allow investments to grow

with taxes on earnings postponed.

  • Roth Accounts - Money contributed to a Roth IRA, which is after-tax dollars, can

grow tax-free. Qualified withdrawals in retirement are also tax-free, making them

suitable for those who expect to be in a higher tax bracket in retirement.

Optimizing Investment Strategies

  • Asset Location (what investments go in what accounts) - maximizing after-tax

returns by strategically placing your investments in different account types

  • Selling investments that have declined in value to offset capital gains can reduce tax

liability and allow for portfolio rebalancing

Long-Term Perspective:

  • Estate Planning - Using techniques like trusts or gifting strategies can minimize

estate taxes and facilitate wealth transfer to future generations.

Tax Planning Is Year-Round:

  • Don’t just wait until April - strategize all year round. Aligning your strategy with life

events like selling a home, retiring, and inheritance.

Collaboration Matters:

  • Advisors often coordinate with CPAs or offer integrated advice

Tax strategy + investment plan = best results

This is why 4Wealth has a leg up in our ability to coordinate our advisory side with our

CPAs tax knowledge. Let us help you build a tax-smart financial plan.

Contact us today at 708-665-6663 or advisors@4wealthfg.com.

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