Wealth Management
With upcoming tax changes in 2026, now is an opportune time to explore strategies for maximizing tax alpha in investment portfolios, and here are four strategies recommended by JPMorgan:
- One key approach is asset location optimization, ensuring tax-inefficient investments are placed in tax-advantaged accounts like IRAs or 401(k)s, while assets benefiting from long-term capital gains are held in taxable accounts.
- Tax-aware trading—including active tax-loss harvesting and tax-efficient portfolio transitions—can further enhance after-tax returns.
- Charitable giving strategies, such as donating appreciated securities to donor-advised funds or making qualified charitable distributions from IRAs, offer additional tax benefits.
- Wealth transfer techniques, like grantor retained annuity trusts (GRATs), can help pass on assets with minimal tax implications.
Finsum: Using a line of credit can provide liquidity without forcing premature, tax-inefficient asset sales.
Small-cap stocks, typically valued between $250 million and $2 billion, are regaining popularity among investors after years of underperformance. Economic growth plays a significant role in this resurgence, as smaller firms tend to benefit more from increased consumer and business spending.
Additionally, the Federal Reserve's recent rate cuts are expected to lower borrowing costs, a crucial factor for small businesses that rely heavily on credit. Another driver of renewed interest is valuation—many analysts believe small caps are undervalued compared to their larger counterparts.
For investors seeking exposure while mitigating risk, small-cap ETFs like Vanguard Small-Cap Growth ETF (VBK), iShares Morningstar Small-Cap Growth ETF (ISCG), and Invesco S&P SmallCap Momentum ETF (XSMO) offer diversification and professional management.
Finsum: With economic growth in recent quarters, small caps may continue to gain traction in the coming years.
In 2024, travel transformed with AI-assisted trip planning, a resurgence of luxury train journeys, and a growing emphasis on wellness through solitude and stargazing. Urban explorers embraced green spaces and foraged dining, while music enthusiasts traveled extensively for live performances.
As 2025 approaches, the focus will shift toward deeper, experience-driven adventures. Literature-inspired tourism is on the rise, with book festivals attracting larger crowds and hotels celebrating their literary connections.
Astrocartography is gaining traction, guiding travelers to destinations aligned with their personal astrological charts. Meanwhile, honeymoons are becoming more immersive, with newlyweds favoring extended, meaningful getaways over traditional weeklong retreats.
Finsum: While everyone is implementing AI to improve efficiency, don’t forget to leverage it for personal matters such as gift and vacation ideas.
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The debate over custodial pricing continues, with many questioning whether bundling all revenue sources into a single fee is fair. Since custodians don’t face significantly higher costs for a $10 million account versus a $100,000 one, a pay-for-services-used model may be more equitable.
Another pressing issue is the slow adoption of automated onboarding, as many custodians still require paper forms and wet signatures despite available digital alternatives. Some speculate that firms hesitate to streamline transfers because it would make it easier for advisors to switch custodians, reducing client stickiness.
Beyond pricing and onboarding, factors like service quality, cost, and additional features—such as dedicated support teams or integrated technology—shape custodian selection.
Finsum: As the industry evolves, understanding these priorities will be key to creating a more efficient and competitive custodial marketplace.
Americans today allocate a larger share of their wealth to the stock market than in previous decades, a shift largely driven by the rise of target date funds (TDFs). These funds, which automatically adjust their asset mix as investors age, have become the default option in many workplace retirement plans since the mid-2000s.
Research from MIT Sloan suggests that the widespread adoption of TDFs has led younger investors to hold more equities than they might have otherwise. The 2006 Pension Protection Act played a key role in this trend by allowing employers to use TDFs as default retirement investments, increasing participation in equity-heavy portfolios.
While the impact of TDFs is strongest in the early years of enrollment, many older investors have also gradually shifted toward similar investment strategies. As TDFs continue gaining popularity, they could contribute to market stability by influencing stock price movements and reducing volatility over time.
Finsum: The default 60/40 portfolio is too passive for many young investors and holding larger equity younger, could accelerate their savings.
As the wealth landscape evolves, the number of high-net-worth individuals is on the rise. And that means financial advisors who can cater to their complex needs will be in high demand. Are you prepared to meet the challenge?
Our infographic provides key strategies to help you become the go-to advisor for these discerning clients, such as:
- Leveraging professional designations
- Offering diverse financial strategies
- Using technology as a service tool
Are you ready to seize this growth opportunity? Transform your approach to serving high-net-worth clients today.