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Tax-efficient investing and you


Have you heard about Series T and Corporate Class investments yet? If the idea of paying your taxes at a later date – when you could be in a much lower tax bracket – sounds like a good idea, Series T and Corporate Class investments may be right for you.

Series T is tax efficient
Series T mutual funds are well suited to people who want their investments to give them a tax-efficient monthly cash flow. What makes Series T so tax efficient? With Series T, a portion of your cash flow will be provided in the form of return of capital (RoC), which is essentially the money that you previously invested (not the gains on your investment). Since RoC is money that you already paid taxes on, some or all of the money you receive as part of your monthly cash flow is not considered taxable income. You pay less tax on your cash flow with Series T mutual funds, which means more of your money stays invested and continues to grow.

Defer the tax hit with Corporate Class
If you invest outside of a registered plan, Corporate Class investments may be right for you. Corporate Class investments are beneficial because, unlike mutual fund “trusts” (the kind of mutual funds that most people invest in), you can move your assets between different funds in the same group without incurring any immediate tax consequences. So, as long as you stay within that group of funds, you can switch your holdings tax free. Think about how this could work over the long term. You could initially invest in mainly equity investments and, as you approach retirement (even over the course of decades), you could continually rebalance your portfolio to put a greater emphasis on fixed income investments. Corporate Class funds are a great way to limit the tax you pay in the near term, while staying nimble and responsive to your changing needs and life circumstances.

You should consider ways to reduce your tax burden when investing, but remember: tax shouldn't be your only consideration. Contact our offices today to see if Series T or Corporate Class investments are right for you

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