8/21/2014

Advisors can maximize a portfolio's after-tax returns by employing asset location, strategically positioning assets between taxable and tax-advantaged accounts. Advisors should place actively managed funds or taxable bonds within tax-advantaged accounts, reserving equity index funds for taxable accounts, since they generate lower income. This article recommends that advisors forgo active management, or include it after fulfilling a client's strategic allocation to bonds, to maximize the returns attributable to asset location.

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