The Key To Tax-Efficient Investing: Asset Location
In earlier Bogleheads’ View columns, I’ve written in detail about tax advantaged retirement accounts such as 401(k)s and IRAs. But many investors also have taxable accounts, including everything from bank savings accounts and CDs to stock or bond investments held through a brokerage account. On the plus side, these accounts have none of the limits on contributions and withdrawals found in special retirement accounts. However, many people underestimate the huge cost of taxes and what that means to the value of their accounts over the long term.
