Strategic Financial Consultants

Think taxes as you tune up your investment portfolio


		Now’s the time to review your investment performance and plan your year-end moves..

	As you identify winners and losers and decide what to hold and what to sell, here are some tax reminders


	Remember that the tax rates on long-term capital gains are 15%, or 5% if you’re in the lower two tax brackets. On short-term gains you’ll pay tax at ordinary income rates, which can be much higher. So try to meet the 12-month holding period on anything you sell, and enjoy the lower rates.


	If you’re planning to take losses, remember that you can use any net capital loss to offset up to $3,000 of ordinary income.


	When you’re estimating investment income for the year, remember that “qualifying” dividends are taxed at lower 15% or 5% rates. Most dividends from U.S.-traded stocks and stock mutual funds qualify, but not dividends on money market funds or bond funds. If in doubt, ask your broker or look at last year’s Form 1099.


	If you’re selling, remember to include reinvested dividends in your cost basis. You’ve already been taxed on these, so don’t pay twice.


	If you’re buying, beware of the year-end capital gains trap. Many mutual funds distribute capital gains only once a year, often in December. If you buy just before the distribution, you could wind up paying tax on the whole year’s capital gains, even though you’ve held the fund for only a short time. If in doubt, check the distribution date with the fund manager.

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Keep your customers coming back

Every successful business relies on a core group of customers who keep coming back on a regular basis. Sure, you're always trying to find new customers and expand your market. But chances are that it's the "regulars" who provide the bulk of your revenues. It's important not to forget this group.

Three fundamental principles hold true whether your business is retail, manufacturing, or services. Customers want to be recognized, they want to receive good service, and they want their loyalty to be appreciated. Most companies strive to provide good service. Unfortunately, it's easy to overlook the other two principles.

One other factor is important — you'll need to train your employees in these areas. Although some employees are naturals when dealing with customers, others will need guidance and reminders. So you should make customer treatment a major focus for all employees who interact with customers.

Here are some tips for providing customer recognition and appreciation. You can customize these to fit the circumstances of your particular business.


Recognition

Encourage your employees to greet customers by name whenever possible.

Set standards for how incoming telephone calls are handled. Train the staff at your reception desk to be warm and friendly with visitors.

Encourage retail sales staff to read the names on customers' credit cards and use them during the transaction.

If appropriate, maintain a data base on regular customers and their preferences.

Attempt to make all customers feel that they're known and liked by your employees.


Appreciation

Make sure you specifically thank customers for their business at the time of the order or sale. This applies whether it's a retail sale or a salesperson taking a telephone order.

Track your regular customers, and send them a note or make a call just to thank them for their business. This is also a great opportunity to ask for feedback on service or other issues.

Consider throwing a customer appreciation event for your regular customers. This could be an informal social event or a special sale, depending on your business.

Brainstorm with your salespeople on how to apply these ideas to your company. Remember that a customer who feels recognized and appreciated will keep coming back.

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