Volatility Adjusted Returns
In this episode, John discusses the impact of taxation on the compounding of wealth, and volatility adjusted returns.
John is the author of 5 Ways Your Wealth is Under Attack and It’s Your Wealth – Keep It.” He has lectured extensively on financial planning and is a recipient of the Five StarSM Wealth Manager Award.
In his latest episode, you will learn:
- How your portfolio generates income, when it gets taxed, and how it gets taxed, are vital to the amount of wealth you can create over time.
- That understanding taxation of Mutual Funds, ETFs, and Unit Trusts is extremely important. It impacts turnover rates and factors that affect your portfolio.
- Finally, taxation and the market volatility adjustment can have an immense impact on your portfolio:
Furthermore, John shows an example of a $500,000 investment that grew at a 10.04% rate of return. He breaks down how 20 years later it’s worth $3.7 million and will be reduced by a little bit over two million dollars. This is when you factor in volatility-adjusted returns and then taxation. So it’s down to $1.6 million!
At Smallwood Wealth, we look at portfolios not only on a market volatility-adjusted basis, but also on a tax-adjusted basis. We always want to be focusing on how to reduce tax and how to reduce risk. This is how we can reduce the impact of volatility-adjusted returns.
Give us a call at 732-542-1565.
If you are new to Smallwood Wealth schedule a Wealth Curve Conversation here.
We look forward to speaking with you.
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