Investment Taxes with Michael Mullen of SEI Investments

Over the past 20 years or so, we’ve observed many doctors making common mistakes at all stages of their careers. We have taken our observations, as well as enlightening discussions with well-established professionals in wealth preservation spaces to bring you our Asset Protection Series: Interviews dedicated to bringing awareness to various risks that can affect your wealth. Every Friday, Anthony Williams and our guest of the week will discuss critical questions to consider and provide tips on how to work towards obtaining comprehensive asset protection.  This week we are excited to present our interview with our long-time colleague, Michael Mullen.

Michael Mullen currently serves as an external wholesaler for Independent Advisor Solutions by SEI in the Mountain West, North Texas, and Oklahoma region. As a relationship manager to financial advisors, Michael spends the majority of his time developing strategic relationships with advisors, broker-dealers, and end-investors. A desire to stay at the forefront of the industry means Michael evolves his portfolio analysis, project management, and investment wholesaling techniques to consistently drive favorable results for stakeholders.

Interview Questions & Topics

1) What are the different types of investment accounts and how are they taxed?

  • Qualified Accounts: 401k, IRA, 403b, SEP IRA
    • Pre-tax category: tax deferred, grows tax-free until a distribution is taken out
    • Post-tax category: grows tax-free and does not require payment of tax at the time of distribution
  • Non-Qualified Accounts: Annuities, REITs, Stocks, Bonds

2) How do taxes diminish the return in the accounts outside of the tax-deferred “bubble”?

  • Mismanagement of Non-Qualified Accounts
    • Critical to maximize post-tax return as well as pre-tax returns
    • Failure to reposition portfolio

3) Within non-qualified/taxable accounts, are certain investments or investment vehicles better from a tax standpoint?

  • Fixed Income & Municipal Bonds
    • Tax-free income
    • Suited for higher tax brackets
  • Index Funds
    • Passive, no active management or turnover
  • Tax-Managed Mutual Funds
    • Eliminate high turnover and minimize capital gain distributions

5) How much wealth can be lost if my non-qualified/taxable accounts are not managed for taxes? What can advisors do to offset that drain to wealth?

  • Improving Tax Alpha: Portfolio’s percentage of excess return after taxes
    • Continuous Tax Loss Harvesting: Realizing a loss to offset gains
  • Working With an Educated Advisor

Watch the full interview with Michael Mullen:

Be sure to check out our other informative interviews here.

Securities and investment advisory services offered through NEXT Financial Group, Inc. Member FINRA/SIPC. None of the named entities are affiliates of NEXT Financial Group, Inc. Neither NEXT Financial Group nor its Representatives give tax or legal advice. Reference code:.