Winning Tax Strategies: From First Save to Final Score

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Keep More. Send Uncle Sam Less.

Don’t get me wrong. I love America. But let’s hold onto as much of our hard-earned money as possible and take advantage of tax breaks. We’re all about tax avoidance, which is entirely different from tax evasion (that’s illegal)! But taxes can and do diminish your retirement nest egg. And, the more zeros in your portfolio, the more complex tax planning can be. With the right strategy, you could minimize your tax obligations, you just need to know where to start.

Craft Your Game Plan. Save Smart for Your Future.

Most investors don’t know that tax planning for retirement starts when you start to save your first dollar. You have choices in how you save. Strategic saving can lead to strategic spending in retirement years and can even save your loved ones in the next generation significant amounts of money. 

However, we can’t set this plan in motion and put it on autopilot. Active engagement and regular updates to your tax strategy are essential, as it’s not a ‘set and forget’ plan. Life can, and often does, change. As the complexities of life increase over time, so does the complexity of taxes. Your tax plan might need adjusting for any number of reasons: different income streams, change in marital status, family expansion, property acquisitions, and even the occasional SEC football game! Having a playbook of strategies in your back pocket can help you be proactive in making the best decisions for you and your family.

Play Strategically. Master Your Tax Game.

Here are some approaches that could play a part in your tax strategy:

  1. Asset Location: Placing investments in the most tax-efficient accounts (e.g., taxable vs. tax-deferred accounts) based on their tax treatment.
  2. Tax-Loss Harvesting: Selling investments at a loss to offset capital gains tax liabilities can be particularly useful in managing taxable investment accounts.
  3. Utilizing Low-Turnover Funds: Investing in funds with low turnover rates to minimize capital gains distributions, which are taxable events.
  4. Choosing Tax-Efficient Funds: Index funds or ETFs typically have lower turnover rates than actively managed funds.
  5. Roth Conversions: Converting traditional IRA funds to a Roth IRA can be beneficial when your income is lower, taking advantage of lower tax rates on the converted amount.

Each of these strategies requires careful consideration of your personal financial situation and tax implications because your tax strategy is tailored to you. Be sure you understand all the ins and outs of these strategies before implementing them, paying close attention to the potential tax consequences, as some strategies cannot be reversed. Review them over and over again before making your first play.

Tailor Your Play. Win Your Financial Future.

Because tax planning is not a one-size-fits-all all, working with someone who can coach you through it is necessary when planning out your long-term retirement objectives.

Navigating tax strategy is complex and requires careful planning, much like meticulously organizing a puzzle, ensuring every piece fits perfectly without unnecessary loss. In the end, it’s just like playing a game of Tetris with Uncle Sam. He might need his share, but with a bit of clever maneuvering, you’ll be sending him just a postcard instead of your entire vacation fund. So, let’s run up the high score to maintain thicker wallets!


Benchmark Wealth Management and LPL Financial do not offer tax advice or services. Please speak with a tax professional about your specific situation.

Traditional IRA account owners have considerations to make before performing a Roth IRA conversion. These primarily include income tax consequences on the converted amount in the year of conversion, withdrawal limitations from a Roth IRA, and income limitations for future contributions to a Roth IRA. In addition, if you are required to take a required minimum distribution (RMD) in the year you convert, you must do so before converting to a Roth IRA.

Benchmark Wealth Management
5855 Ridge Bend Road
Memphis, TN 38120

Securities and advisory services offered through LPL Financial, a Registered Investment Advisor, Member FINRA/SIPIC.

The opinions voiced in this material are for general information only and are not intended to provide
specific advice or recommendations for any individual. There is no assurance that the views or
strategies discussed are suitable for all investors or will yield positive outcomes.
Investing involves risk including possible loss of principal.

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