This is a missed opportunity to build a buffer to absorb shocks associated with unexpected health care expenses and, for those more fortunate, to accumulate additional tax-efficient funds
for later in life.
As such, it may be advisable to utilize ETFs for the stock exposure (due to their preferential treatment on year-end capital gain distributions), use tax losses to offset gains, and select more tax-efficient funds
The study finds that tax-efficient funds have tended to outperform other funds with respect to both before-tax and after-tax returns.
The results do not suggest that tax-efficient funds perform worse than their peers with regard to pre-tax returns.
aim to minimize the distributions that are made to shareholders, thereby limiting the amount of income that must be declared.
: Tax-efficient funds
(such as index funds) are excellent long-term savings vehicles due to their low turnover, which reduces capital gains distributed over the investment's life.
Appropriate solutions for HNW individuals and small-business clients will be driven by asset allocation, risk management, consolidated statements and some alternative investment classes such as real estate and tax-efficient funds
After completing this case students should be able to (1) calculate pre- and post-tax mutual fund returns; (2) rank funds based on a tax client's tax rates and after-tax returns; (3) understand the long-term effect of taxes on mutual funds returns; (4) develop strategies to maximize the investor's after-tax return; and (5) identify characteristics of tax-efficient funds.
The disclosure is not required to appear in advertising unless the fund is presented as a tax-efficient fund.
This makes the mote tax-efficient funds
the most appealing.
Investors may be able to reduce their tax bill and increase their after-tax return by investing in tax-exempt funds, such as municipal bond funds, in their taxable accounts, or consider investing in tax-efficient funds
, such as index and tax-managed funds.
The William Blair FCP provides a tax-efficient fund
vehicle aimed at benefiting non-US based investors.