Taxes A SMART approach to tax-efficient investing

Tax efficiency is moving to the center of portfolio conversations, particularly for high net worth investors who are highly sensitive to taxes. A systematic framework like SMART helps advisors keep tax planning aligned with client goals by focusing on objectives first, then maximizing after-tax returns rather than simply minimizing current tax bills.

Thoughtful asset and vehicle selection across taxable and tax-advantaged accounts, including the use of ETFs, SMAs and model portfolios, can create meaningful “tax alpha” without sacrificing diversification or risk control. Advisors can further enhance outcomes by rebalancing with taxes in mind, using cash flows and qualified accounts first, and by implementing ongoing tax-loss harvesting and charitable strategies such as donor advised funds or QCDs.

When integrated into holistic planning, tax-efficient investing becomes a powerful way to deepen client relationships and improve long-term after-tax results.