Nick Bare

Most of my clients hate paying taxes. That part is universal. But what I’ve noticed over years of helping high-net-worth families with tax planning is that the instinct to avoid taxes today often leads to paying significantly more of them tomorrow. The pattern shows up consistently: A client prefers to draw first from Roth accounts or taxable brokerage accounts, which are taxed at favorable capital gains rates, to avoid touching their IRA or 401(k) for as long as possible. It feels like a win.

When you buy through links on our articles, Future and its syndication partners may earn a commission. Most of my clients hate paying taxes. That part is universal. But what I've noticed over years of helping high-net-worth families with tax planning is that the instinct to avoid taxes today often leads to paying significantly more of them tomorrow.