Based on our research, we've found that many actively managed funds that claim to "beat the market" often fall short while still charging high fees, sometimes exceeding 1% per year. At Wealthstone, we prioritize low-cost index ETFs as the foundation of our investment strategy, as they aim to replicate the returns of major benchmarks like the S&P 500 with minimal fees. This approach not only keeps costs low but also aligns with the goal of delivering consistent, long-term returns. For clients with more complex financial situations, we offer direct indexing as a complementary strategy. Direct indexing enables us to implement tax-loss harvesting more effectively, taking advantage of market fluctuations to optimize after-tax returns. Research suggests that this strategy can provide a Tax-Alpha—an increase in after-tax returns compared to the benchmark—of around 1% or more through efficient tax management. Our tailored approach ensures that each client benefits from a strategy that balances cost-efficiency, diversification, and tax advantages to maximize their overall returns.

We integrate alternative investments into our strategies, recognizing their potential to enhance returns and income. These investments, spanning diverse asset classes and strategies, play a crucial role in broadening portfolio diversification and reducing correlation with traditional markets. Our focus includes private equity, venture capital, private credit, hedge funds, and real assets, each offering unique benefits such as higher return potential, alternative income sources, tax-efficiency, and inflation protection. Embracing these alternative strategies, we aim to help our clients achieve their long-term investment goals, complementing traditional stock and bond allocations with innovative, versatile tools for building a robust portfolio. Through our partnership with Charles Schwab and industry relationships, our clients are provided with access to an industry-leading alternative investments platform. We conduct significant due diligence with any alternative investment strategies we recommend, and we dedicate time with each client to educate them on the risks, liquidity, and costs for alternative investment strategies.

Tax-efficient investing will be a high-priority component of your strategy. We understand that minimizing tax liability is key to maximizing your investment growth. We employ innovative strategies tailored to your unique financial situation, focusing on optimizing after-tax returns. By leveraging tactics such as efficient asset allocation, tax-loss harvesting, and thoughtful selection of tax-advantaged investment vehicles, we strive to enhance the efficiency and performance of your portfolio. This focus on tax efficiency plays a vital role in preserving more of your wealth, ensuring it works harder for you and aligns seamlessly with your long-term financial aspirations.

The detrimental effects of high-cost investment strategies on your long-term financial objectives are profound and often irreversible. We place a significant emphasis on cost-effective investment strategies. By minimizing expenses, a larger portion of your funds remain actively invested, fostering growth and compounding over time. This approach is pivotal in enhancing the likelihood of achieving greater financial success and realizing your long-term goals.