Your Best Investment May Be a Tax Strategy
Investors spend enormous energy trying to beat the market. That effort can be pointless if taxes consume the extra return before it can compound.
A better first investment may be learning the tax code and building a tax strategy: capture an employer match, use available retirement accounts, choose between traditional and Roth contributions thoughtfully, use an HSA when eligible, and keep tax-inefficient assets out of taxable accounts when practical.
A five-year example
Assume two people can direct $20,000 of gross income per year toward investing. Contributions happen at year-end, there is no employer match, and the tax rates are simplified for illustration.
