PORTFOLIO MANAGEMENTHow We Create Value for Our Clients1The many ways our management benefits you as a client!Portfolio management personalized to your needs!We create an asset allocation strategy appropriate to achieve your particular risk/return goals and that becomes the foundation for your portfolio management. Of course, there is more to managing your investments personal advice and ongoing planning is essential to reaching your goals.3Achieving long-term growth - diversification

Diversification is essential to assuring long-term growth. Eliminating big swings can avoid having to make up huge losses in your portfolio following market downturns. Thus, we create a portfolio allocation made up of investments specifically designed to make the most of your investment dollars. 4Achieving long-term growth - rebalancing

To maintain consistent risk/return parameters, periodic rebalancing is necessary. If we dont keep portfolio proportions consistent through market swings, we cant limit volatility to within the original parameters. And, that volatility could interfere with your long-term goals in a big way. Because we have invested in state-of-the-art rebalancing software, we are able to monitor your portfolio DAILY and trade only when necessary. This ensures that your strategy is consistently maintained and you dont incur a lot of unnecessary trading fees. Did you know that over 90% of advisors rebalance by hand or with spreadsheets and, so, rebalance only one to four times per year? 5Tax Management

Tax Management:Rebalancing necessarily requires sales and purchases. When sales are made in taxable accounts, gains might be recognized. Absent basis step-up on death, appreciation in taxable accounts will eventually become taxable. However, because of the compounding value of tax deferral and because our clients would rather pay less taxes than more, we focus on minimizing taxable gain recognition when rebalancing. To truly minimize tax, we must coordinate various factors. For example, can sales be made in non-taxable accounts (such as IRAs) rather than taxable accounts? Can high cost lots be specifically identified for sales? Can short-term gains be avoided? We do all of this and more!

Reducing Capital Gains

When reducing capital gains taxes, we can create permanent savings or temporary savings.Permanent SavingsAvoiding short-term gains0% capital gains rateTemporary SavingsSelling high cost lots firstTax loss harvestingOther PointsSelling from non-taxable accounts when possibleStep-up at deathTax Loss Harvesting

When the opportunity arises, we sell positions in a taxable account to recognize loss. Most advisors only do this at the end of year, if at all. Because we can easily identify when a tax losses is available, we will sell to create a tax benefit and replace the position with something else in the same category. This avoids wash sales and keeps your investment strategy intact. In some years, we are actually able to create an overall tax loss to report on a clients tax return even though their portfolio has grown in value!Location Optimization

RothTaxableIRAWe manage your accounts as one overall portfolio, meaning we place investments into various account types in order to minimize long-term tax consequences. This results in in permanent savings because appreciation is eventually taxed at long-term cap gain rates or avoided altogether from basis step-up at death and it avoids tax on the highest-return-generating assets.You also get higher after-tax returns from holding income-producing assets in your IRA. Finally, you get higher pre-tax returns because we hold taxable bonds in your IRA vs. munis in your taxable account.(Location optimization seeks to hold positions in optimal account locations, when possible, in order to maximize tax efficiency. In an ideal world, investments generating ordinary income should be held in retirement accounts to avoid current taxation. Investments held primarily for long-term appreciation should be held in taxable accounts in order to take advantage of capital gains rates and/or basis step-ups at death. And, investments generating high expected long-term returns should be held in Roth IRAs since these returns will avoid tax altogether.)Tangible BenefitsIntangible BenefitsThe tangible benefits of our portfolio management can be seen in black & white in your quarterly reports.The intangible benefits are what differentiates us from other managers: We take away the worry.We are available to meet with you and talk to you whenever you want.We will be your trusted partner in helping you to reach your goals.Quality investment management + tax efficiency = Peace of Mind