Love Your Finances One Smart Tax Move at a Time – Tax Strategies You’ll Adore
From the Wealth Management Team at State Bank
When it comes to managing your money, a little love can go a long way—especially when that love is focused on your tax strategy. Whether you're planning for retirement, supporting a cause close to your heart, or simply trying to make the most of market ups and downs, thoughtful tax planning can help you grow and protect your wealth with greater confidence.
Here are five tax-smart strategies that can help you fall in love with your finances all over again:
1. Retirement Savings Tax Breaks – Your Future Will Thank You
Saving for retirement is more than just a good idea—it’s a powerful way to reduce your tax bill while building financial freedom for the future. Accounts like 401(k)s and IRAs offer either tax-deferred growth or tax-free withdrawals, depending on the type you choose.
And if your employer offers a match on 401(k) contributions? That’s essentially free money—don’t leave it on the table.
Even small, regular contributions today can grow significantly over time thanks to compound interest. Whether you're just starting out or nearing retirement, it’s never too early—or too late—to make your future a priority.
2. Charitable Giving – Give from the Heart, and Gain at Tax Time
Supporting the causes you care about can also come with financial benefits. When you itemize deductions on your tax return, charitable donations may help lower your taxable income. And it doesn’t stop at cash donations.
Donating appreciated assets—like stocks or real estate—can help you avoid capital gains taxes while still receiving a charitable deduction for the full market value. It's a win-win: you give generously, and your taxes work smarter.
A well-timed charitable strategy can create a legacy you’re proud of, all while being kinder to your bottom line.
3. Roth Conversions – Future You Will Be Grateful
Thinking ahead can pay off in a big way when it comes to Roth conversions. This strategy involves moving funds from a traditional IRA to a Roth IRA—ideally during a lower-income year or a market dip.
By spreading conversions out over several years and paying taxes from outside your IRA, you can reduce your future required minimum distributions (RMDs) and give your investments a chance to grow tax-free.
It’s also a smart way to create flexibility in retirement, with both taxable and tax-free sources of income at your disposal.
4. The Power of Tax-Advantaged Accounts – Grow More, Worry Less
Certain accounts are designed to help you build wealth and save on taxes at the same time. Roth IRAs and traditional IRAs both offer unique tax benefits, and 401(k)s can lower your taxable income right away.
Health Savings Accounts (HSAs) are another overlooked gem. Contributions are tax-deductible, growth is tax-free, and withdrawals for medical expenses are tax-free too.
Planning for education? 529 college savings plans allow your money to grow tax-free when used for qualified expenses. These accounts aren’t just helpful—they’re powerful tools to help your money go further.
5. Tax-Loss Harvesting – Turning Market Losses into Tax Breaks
Market ups and downs are part of investing—but did you know you can use the down moments to your advantage?
Tax-loss harvesting means selling investments that have lost value to offset gains from other investments or reduce your taxable income. It’s a strategy that makes even a rocky market work for you.
By reinvesting in similar (but not identical) assets, you stay on track with your investment plan while boosting your after-tax returns.
Ready to Put These Strategies to Work?
Smart tax planning isn’t just about reducing what you owe—it’s about helping you reach your goals with greater clarity and confidence. Our Wealth Management team at State Bank is here to help you uncover the strategies that make the most sense for your unique situation.
Let’s create a financial plan you’ll love—one smart tax move at a time.