Tax-Efficient Investing

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Hey Coach,

Most coaches focus on what to invest in.
Smart coaches also think about where those investments live.

That concept is called asset location - and it can quietly add thousands of dollars to your long-term results without increasing risk.

Let’s break it down in plain language.

The Big Idea

Different accounts are taxed differently.

Putting the right investments in the right accounts helps you:

• Reduce taxes over your lifetime

• Increase flexibility in retirement

• Keep more of what your investments earn

Same investments.
Better placement.
Better outcome.

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The Three Investment Buckets

Most coaches have money in some combination of these:

1. Taxable Accounts

Brokerage accounts, joint accounts, trust accounts.

Tax traits:

• Dividends & interest taxed yearly

• Capital gains taxed when you sell

• Long-term gains often taxed at lower rates

Best fit for:

• Broad stock index funds

• ETFs with low turnover

• Assets you may need before retirement

2.  Tax-Deferred Accounts

401(k), 403(b), traditional IRA, 457 plans.

Tax traits:

• Contributions often reduce taxes today

• Growth is tax-deferred

• Withdrawals taxed as ordinary income

• Required Minimum Distributions (RMDs) later

Best fit for:

• Bonds

• Actively managed funds

• Higher-turnover investments

3. Tax-Free Accounts

Roth IRA, Roth 401(k).

Tax traits:

• Contributions made with after-tax dollars

• Growth is tax-free

• Withdrawals are tax-free

• No RMDs (during your lifetime)

Best fit for:

• Stocks with high growth potential

• Long-term equity holdings

• Assets you want maximum flexibility from later

A Simple Asset Location Framework

You don’t need perfection. You need intention.

A solid baseline approach:

• Roth: Growth assets (stocks, equity funds)

• Tax-Deferred: Income-heavy or tax-inefficient assets (bonds)

• Taxable: Tax-efficient stock funds and flexibility money

Think of it like lineup construction - every player has a role.

Common Coaching Mistakes

• Holding bonds in Roth accounts

• Putting high-growth stocks in tax-deferred accounts without a plan

• Ignoring taxes when choosing investments

• Treating all accounts the same

That’s like running the same offense regardless of personnel.

Why This Matters in Retirement

Good asset location gives you:

• Better control over taxable income

• More flexibility when markets drop

• More options for Social Security timing

• A smoother withdrawal strategy

Defense wins championships - and taxes are part of defense.

Final Whistle

You don’t need exotic investments to build wealth.

You need:
✔️ Solid investments
✔️ Smart account placement
✔️ A long-term plan

What you invest in matters.
Where you invest it matters more than most people think.

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Coach Mike Klinzing
Founder, Wealth4Coaches
"Coach smarter. Save better. Live freer."