Tools/Investing/Asset Location Calculator✓ CHECKED AGAINST WORKED EXAMPLES · SEP 29, 2026

Which investments should go in which account?

Given the same stock and bond mix overall, see where each should sit across your taxable, pre-tax and Roth accounts to keep the most after tax, and what the right placement is worth compared with holding the same mix everywhere.

Edit on my map

Taxable accounts$An example: brokerage accounts. Your Money Map holds one invested total and does not split accounts, so enter your own balances.Pre-tax accounts$An example: traditional IRA, 401(k), 403(b). Withdrawals are taxed as ordinary income.Roth accounts$An example: Roth IRA and Roth 401(k). Qualified withdrawals are untaxed.Stocks’ total return, including dividends% a yearThe Money Map’s assumption: 7% before inflation. It is not a forecast; real returns are uneven.Stocks’ dividend yield% a yearAn example: the part of the stock return paid out each year and taxed at the qualified dividend rate. The rest is price gain.Bonds’ yield% a yearA starting figure: the 10-year Treasury yield on September 29, 2026. Bond funds pay about the yield and their price is assumed not to change.Years until you use the moneyyearsPrefilled as the years to age 65 from your Money Map. Nothing is withdrawn before then.Tax rate on bond interest%Prefilled with your federal bracket from the Money Map. Add your state’s rate if it taxes interest.Tax rate on qualified dividends and long-term gains%An example: 15% is the federal rate for most people (0%, 15% or 20% by income). Add 3.8% at high incomes and any state rate.Tax rate when you withdraw pre-tax money%An example: your expected bracket in retirement. It is taken from the pre-tax accounts at the end.

Share of the whole portfolio in stocks70%An example. The rest is in bonds. This page decides where they sit, not how much of each you hold.

WORTH OF THE RIGHT PLACEMENT

+$52,801after tax vs the same mix

Holding the same 70% in stocks in every account, $420,000 grows to $2,480,380 after tax in 31 years. Placing the stocks in the accounts where they beat bonds by the most leaves $2,533,180, $52,801 more, about 0.07% a year. Stocks go in the taxable ($150,000), pre-tax ($74,000) and Roth ($70,000); bonds in the pre-tax ($126,000). The worst placement would leave $2,427,322.

Same mix everywhere

$2.48M

Best placement

$2.53M

Worth a year

0.07%

Worst placement

$2.43M

UNDERSTAND YOUR RESULT

LIBRARY CHAPTERREITs: Real Estate Through the Stock MarketWhat a real estate investment trust legally is, the main kinds, how REIT dividends are taxed and why they belong in retirement accounts, how analysts value REITs, and how much real estate a portfolio already holds.LIBRARY CHAPTERBuilding the Bond Side of a PortfolioHow to choose bonds for the job they do: duration and matching it to when you need the money, credit quality and its trade-off, three common structures, bond ladders, and which accounts should hold bonds.

Terms:Capital gains distribution Asset location Real estate investment trust (REIT)Tax drag

After-tax wealth in 31 years, by placement

Best placement

$2.53M

Same mix everywhere

$2.48M

Worst placement

$2.43M

The same $420,000, the same 70% in stocks and the same returns give $2,533,180 at best and $2,427,322 at worst: a range of $105,858 from placement alone. Holding the same mix everywhere lands in between at $2,480,380.

Where each investment goes under the best placement

Account	Balance	Stocks	Bonds	Stock share
Taxable accounts	$150,000	$150,000	$0	100%
Pre-tax accounts	$200,000	$74,000	$126,000	37%
Roth accounts	$70,000	$70,000	$0	100%

Accounts are filled with stock in the order of how much a dollar of stock beats a dollar of bond in each after tax: taxable, then Roth, then pre-tax. Bonds take the rest, filling from the other end of that list: pre-tax, then Roth, then taxable.

What $1 becomes after tax in 31 years

Account	Stock	Bond	Stock’s edge
Taxable accounts	$6.74	$3.37	+$3.37
Pre-tax accounts	$6.35	$3.82	+$2.53
Roth accounts	$8.15	$4.90	+$3.25

A dollar of bond in a taxable account grows to only $3.37 in 31 years because its interest is taxed every year, against $4.90 in a Roth; a stock's price gains there are taxed once, at the end. The larger the “edge” column, the better the account for stocks. The pre-tax account is taxed at withdrawal whatever it holds, so it takes the same fraction of either.

What the right placement is worth, by years held

The gain grows the longer the money stays, because the yearly tax drag on bonds and dividends in a taxable account compounds: $5,811 after 10 years, $19,706 after 20, $104,510 after 40.

What moves the needle

Each row re-runs the calculation with one change. Click to apply.

How it's computed

FORMULA

Roth: $1 × growth. Pre-tax: $1 × growth × (1 − the withdrawal tax rate)

Taxable bond: (1 + yield × (1 − the rate on interest))^years

Taxable stock: each year the price gain compounds untaxed and the dividend, taxed at the qualified rate, is reinvested (raising the basis); at the end V − the long-term rate × (V − basis)

The best placement fills accounts with stock in order of (a dollar of stock − a dollar of bond) after tax, highest first; bonds fill the rest

Stocks earn 7.0% a year, of which 2.0% is paid as qualified dividends; bonds earn their 5.26% yield as interest and their price is assumed not to change. Returns are steady; they are not in real life, and the result depends on the gap between the two.
Interest is taxed at the ordinary rate you enter, dividends and long-term gains at the second rate, and pre-tax withdrawals at the third, all constant for the whole period. The taxable accounts start with a basis equal to their value, and everything is sold at the end.
The mix is not rebalanced along the way, no new money is added and nothing is withdrawn before the end. Selling in a taxable account to rebalance would trigger gains, which is a reason to keep the assets that need selling in tax-advantaged accounts.
Vanguard describes the principle as holding tax-efficient investments in taxable accounts and those with a heavier tax burden, such as taxable bonds, in tax-advantaged accounts. The page shows how much that is worth on your numbers, and which account comes out best for stocks changes with the bond yield and the tax rates.
Not counted: the step-up in basis at death, tax-exempt municipal bonds, state tax unless folded into the rates, the net investment income tax, and the risk of holding more of one asset in one account.

WORKED EXAMPLE · SAMPLE NUMBERS

After 31 years $1 becomes: taxable stock $6.74, taxable bond $3.37; pre-tax stock $6.35, bond $3.82; Roth stock $8.15, bond $4.90. The stock edge is largest in the taxable account, so stocks go there first ($150,000), and so on. Total $2,533,180 against $2,480,380 with the same mix everywhere.

SOURCES

[1]Managing your accounts to lower taxes (asset location)Vanguard [2]Topic no. 403, Interest receivedInternal Revenue Service [3]Topic no. 404, DividendsInternal Revenue Service [4]Topic no. 409, Capital gains and lossesInternal Revenue Service [5]Daily Treasury Par Yield Curve RatesU.S. Department of the Treasury

HSBuilt by Hussain Sehorewala · checked against worked examples · Sep 29, 2026

Keep this number honest as your life changes.

Put it on your Money Map and it re-runs as you change the seven numbers. It stays in this browser, and the calculator stays free.

Open your Money Map Tell me when bank sync opens

Questions about this result

Choosing which investments to hold in which kind of account, not just how much to hold of each. Interest on bonds is taxed every year at ordinary rates in a taxable account, while stocks’ price gains are taxed only when sold and their qualified dividends at lower rates. Putting the heavily taxed investments in tax-advantaged accounts and the lightly taxed ones in taxable accounts can leave more after tax with the same overall mix.

Usually the pre-tax accounts are the best home for taxable bonds, as Vanguard notes, because interest there is not taxed as it is paid. On the default numbers the calculator puts bonds in the pre-tax account and stocks in the taxable and Roth accounts. The details change with the bond yield and your tax rates, so check your own.

The Roth is where growth is untaxed forever, so it favors the investment with the most growth. But a dollar of bond earns tax-free interest there too, and when bond yields are high the tax saved on bonds can outweigh the tax saved on stocks. The calculator compares the two on your numbers rather than assuming one.

On the default numbers, about 0.07% a year, or $52,801 more after tax over 31 years on $420,000. It grows with the tax rates, the gap between bond and stock taxes and the length of time. It is real but modest compared with the mix of stocks and bonds itself, and with fees.

Yes, in practice: new money can go where the placement says it should, which is the easy way to move toward the best placement without selling anything. This page assumes a single starting balance and no contributions.

No. Tax-exempt municipal bonds are an alternative to taxable bonds for high-bracket investors in taxable accounts, and harvesting losses is a separate technique. Neither is in the page.

THE LEDGER · 12 minThe Advanced 2026 Tax Strategies That Create Generational Wealth

THE LEDGER · 8 minWhy Generic AI Falls Short for Financial Advice - And How Specialized Knowledge Changes Everything

YOUR MAP · 0 of 7 doneNext: FIRE CalculatorContinue →