We are nearing the end of a fantastic year for the stock market. It is not unusual for our clients to be up 20% this year. This is a good time to consider the following:
- Avoid taking unnecessary gains in taxable accounts. By waiting until January 1, you can push the tax obligation out into 2026.
- Take as many losses as you have in taxable accounts to save taxes in 2025.
- Have a strategy to protect your gains. Using stop-loss orders can help avoid giving back hard-fought profits.
- Consider switching from traditional mutual funds to exchange traded funds (ETFs) to control your gains better and likely reduce taxes. If you bought a Growth fund mid-year, and the fund decided to sell a stock it has held for years, you get to help pay taxes on those gains. This is not true for ETFs.
- Prepare a year end balance sheet measuring end-of-year balances on all assets and liabilities. This is an easy way to track your financial progress over time.
Happy Holidays from your Team at Braeburn Wealth Management!
