There’s no point in obsessing over the rate of return if you don’t discuss taxes.
For example:
Say a Treasury bond yields 4.18%.
GREAT
If you're in the 35% federal bracket, the interest is taxed at 35% (Treasury interest is exempt from state income tax).
Meaning 4.18% return is more like 2.7%
TERRIBLE
There is ZERO point in getting excited about a good rate of return, if you don’t plan the taxes out.
This is something your advisor should be talking to you about.
Does your advisor talk to you about taxes?
Have they asked to see your returns?
Every year?
If not you should take this 6-question assessment to see if anything else is being missed.
About the author
Founder of Jones Fiduciary Wealth Management. He spent nearly two decades on the legacy side of the industry before building a fiduciary advisory firm where the tax strategy comes first and the portfolio follows. Author of UnBrainwashed Investing.
