How to Increase Aftertax Returns by Doing Less


This week’s AAII Weekly Digest highlights these “must-read” AAII articles:

Guidance on How to Follow the Level3 Passive PortfolioGuidance on How to Follow the Level3 Passive Portfolio

This portfolio of four exchange-traded funds (ETFs) should not have many changes. Many investors should be able to rebalance through additions or withdrawals.

For Bucket Portfolios, the Devil Is in the Details

Christine Benz

Guidance on implementing a bucket strategy in a real-world portfolio, including portfolios with more than one type of account.


Rebalancing Update: 4.5% Withdrawal Rate and Rolling Periods

Increasing the withdrawal rate led to bigger distributions, but lower ending wealth. Altering the investing period also has an impact.


When Less Is More: How to Increase Aftertax Returns by Doing Less

A lot of attention is given to stock and market returns. However, most of the attention is focused on rates of return before taxes. The bottom line, though, for any investor is what’s left after all expenses, and for most taxable investors, taxes are the biggest expense an individual investor faces. This article focuses on how frequent trading, or high portfolio turnover, increases taxes, which in turn reduces aftertax performance.

Our Member Question for this week is:

What is your prediction for the S&P 500 index in 2019?


Vote to answer this week’s Special Question: What is on your investment wish list for 2019?

Last Week’s Results:

Our weekly reader surveys are taking a break this week and will return the week of December 24.

AAII e-book: Portfolio Building

“Easier said than done” is a common saying that applies well to developing an overall strategy for your investment portfolio. The basic concepts are relatively easy, but they become more complex and less clear-cut when it comes to applying them to real-world situations. This e-book, available exclusively to AAII members, is designed to bridge the gap between theory and practice.

The AAII Weekly Digest is one of the many benefits of AAII membership. To learn more, consider a 30-day Trial AAII Membership to start becoming an effective manager of your own assets.


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