Feng Shui Your Financial House — Day 29

𝐘𝐨𝐮𝐫 𝐝𝐚𝐲 𝟐𝟗 𝐭𝐚𝐬𝐤 𝐢𝐬 𝐭𝐨 𝐨𝐩𝐭𝐢𝐦𝐢𝐳𝐞 𝐭𝐡𝐞 𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐲𝐨𝐮𝐫 𝐚𝐬𝐬𝐞𝐭𝐬.

Worry about asset LOCATION, not just asset allocation.

𝐎𝐩𝐭𝐢𝐦𝐢𝐳𝐞 𝐭𝐡𝐞 𝐥𝐨𝐜𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐲𝐨𝐮𝐫 𝐚𝐬𝐬𝐞𝐭𝐬.

Each asset class is taxed differently (in the U.S., anyway). You can save a lot in taxes by stashing your different assets in the most tax-efficient places. Once you have your asset allocation done, figure out the best asset location for your holdings.

𝐈𝐧𝐭𝐫𝐢𝐠𝐮𝐞𝐝? 𝐇𝐞𝐫𝐞’𝐬 𝐰𝐡𝐚𝐭 𝐭𝐡𝐚𝐭 𝐦𝐞𝐚𝐧𝐬:

If the holdings in your tax-deferred and tax-exempt accounts are the same as your taxable accounts, you will waste thousands and thousands of dollars by paying taxes you legit, 100% don’t need to pay.

𝐓𝐡𝐢𝐬 𝐢𝐬 𝐞𝐬𝐩𝐞𝐜𝐢𝐚𝐥𝐥𝐲 𝐭𝐫𝐮𝐞 𝐢𝐟 𝐲𝐨𝐮’𝐫𝐞 𝐲𝐨𝐮𝐧𝐠 𝐚𝐧𝐝 𝐚 𝐡𝐢𝐠𝐡-𝐞𝐚𝐫𝐧𝐞𝐫.

Who wants to do that?🤷🏻‍♀️

After you’ve figured out your asset allocation (the mix of stocks, bonds, cash and real estate in your portfolio based on your risk tolerance, circumstances, and stage of life) you need to choose the best location for those assets.