Tax-Efficient Portfolios Examples

Growth of $1 after Taxes over 91 Years

$1 invested in 1926 compounded at normal growth rates to be worth more than $7,300 in 2018. If taxes were paid on dividends and gains, the value would have been $873. Clients need to consider the impact on taxes over the next 90 years as they fund trusts for children and grandchildren. Increasing returns 3% can have a huge impact on accumulated values across time. It is common to show how after-tax returns can be increased by 3% when tax planning fees are 30 basis points.