Asset Location - Increase Investing Returns & Reduce Your Taxes
Author: Tim Olson
Location - Once the holy grail only for real estate investors is fast becoming the mantra for every stock, bond, and mutual fund investor. Experts and studies now recognize managing asset location is second only to asset allocation in determining the success of your investment returns.
Importance of Asset Location:
Asset location is a cornerstone to success for a simple reason. Taxable accounts differ from tax-deferred accounts {401(k), IRA and similar retirement}. Taxable accounts require you to pay income tax on every dividend and capital gain generated by your investments. This tax substantially reduces the amount of reinvestment and annual investment growth. On the other hand,...
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