Tax Saving Strategies

Income taxes can be reduced through the use of various tax strategies. Your after-tax returns can be increased when you use tax-efficient investment strategies.  Remember, it is not what you make, it is what you keep that counts.

Tax efficient investing is important to not only to reduce your current tax liabilities, but also to manage your future tax liabilities.  It will also help to generate better after-tax returns.  Tax savings can have a huge impact on the growth of your personal wealth.

No one can predict where tax rates are going.

Going Up? Going Down? Staying Flat? Tax Rates have varied widely over time.

Every dollar put towards investment goes through three phases:

Contribution, Accumulation and Distribution

The bad news is: – You must pay taxes on at least one of these three phases

The good news is: You get to decide which one

The contribution to qualified retirement plan may help a taxpayer to pay less taxes at beginning but it may be resulting to pay higher taxes at distribution.  

Some plans such as life insurance can help a taxpayer to maximum tax free distribution, because it includes:

  • Tax-Deferred Growth;
  • Tax-Free Access during retirement; and
  • Tax-Free death benefits to beneficiaries

Right tax saving strategies will help one to balance and create tax diversifications in these 3 investment phases.