Financial Focus: Wealth and Taxes

anthony_rivieccioAccumulate wealth and  reduce your tax burden

Have a savings account? Own investment mutual funds?  Guess what, your taxes are going UP!

Improving economic and market conditions are leading to an increase in capital gain value for savers and investors.

Based on this year’s tax structure, taxes can cost investors up to 30% of their return or interest in the average mutual fund or savings account.

By using tax inefficient asset classes –or what financial professionals call “Inefficient Asset Allocation”– one can lose even more.

Owners of mutual funds may experience a greater tax bill this year and beyond because of the increase in capital gains distributions.

Time to protect your hard-earned savings!

There are many ways to “shelter your money” from Uncle Sam, state and local tax collectors.

Of course you should consult with a tax or investment adviser for any potential tax and investment consequences, risks and rewards, etc.

A Tax Advantaged Variable Annuity, for example, can help shield your accounts from taxes and potentially grow assets faster. All interest growth is tax deferred until the age of retirement or age 59 1/2.

Another way is Tax-Free Municipal bond accounts which are not subject to federal taxes. State bonds are sources of (now triple) tax free income as well.

Your Tax or Financial Adviser should–if he is doing his job–know your financial needs, wants, goals and dreams. And he should be having this conversation with you NOW. If he is not, then you have something else to replace next year besides your tax paperwork.

I can’t afford to lose thirty cents on the dollars on my hard-earned savings to Uncle Sam? Can you?

Anthony Rivieccio is the founder & the CEO of The Financial Advisors Group, celebrating their 18th year as a fee only financial planning firm specializing in solving one’s financial problems. Anthony, a recognized financial expert since 1986, has been featured by many national and local media including: Klipingers Personal Finance, The New York Post, News12 The Bronx, Bloomberg News Radio, Bronxnet Channel 67 TV, The Norwood News, The West Side Manhattan Gazette, Labor Press Magazine, Financial Planning Magazine, WINS 1010 Radio, The Bronx News and The Bronx Chronicle. Anthony can be reached at 347.575.5045.

The views and opinions expressed are solely those of the author do not necessarily represent those of The Bronx Chronicle, its staff, or contributors.

Note: This article has be edited for corrections.