Most people focus on earning more — but keeping more of what you earn is just as powerful. Tax-efficient strategies like maxing retirement accounts, using backdoor Roth IRAs, and optimizing asset location can save thousands per year — money that compounds in your favor instead of going to the IRS. This 2-minute quiz scores your current tax strategy across the moves that matter most, estimates what you might be leaving on the table, and tells you exactly where to focus next. No login required.
Want to see exactly how much harvesting could save you? Try our tax-loss harvesting calculator.
Frequently Asked Questions
What is a tax efficiency score?
A tax efficiency score measures how well you’re using legal tax-reduction strategies — like retirement account contributions, HSAs, backdoor Roth conversions, and tax-loss harvesting — to minimize your tax burden. A higher score means more of your money is working for you instead of going to the IRS.
How accurate are the dollar estimates?
The estimates are based on 2025 contribution limits and general marginal tax rates for your income bracket. They represent approximate annual tax savings from each strategy. Your actual savings depend on your specific state, deductions, filing status, and other factors. Use these as directional guidance, not precise projections.
What is a backdoor Roth IRA?
A backdoor Roth IRA is a legal strategy for high earners who exceed Roth IRA income limits. You contribute to a traditional IRA (non-deductible), then immediately convert it to a Roth IRA. The result: $7,000/year growing tax-free, regardless of your income. Most major brokerages (Fidelity, Schwab, Vanguard) support this process.
What is tax-loss harvesting?
Tax-loss harvesting means selling investments that have declined in value to offset capital gains elsewhere in your portfolio. You can deduct up to $3,000 in net losses against ordinary income per year, and carry forward unused losses indefinitely. The key: you reinvest in a similar (but not identical) asset to maintain your market exposure.
What is asset location vs. asset allocation?
Asset allocation is what you own (stocks, bonds, REITs). Asset location is where you hold them. Tax-inefficient assets like bonds and REITs generate ordinary income and belong in tax-deferred accounts (401k, IRA). Tax-efficient assets like index funds belong in taxable accounts where they benefit from lower capital gains rates. Same portfolio, lower tax bill.
Should I prioritize 401(k) or Roth IRA?
If your employer offers a match, always contribute enough to get the full match first — it’s an instant 50-100% return. After that, the choice depends on your tax bracket: higher earners typically benefit more from 401(k) tax deferral, while lower earners benefit from Roth’s tax-free growth. Ideally, use both for tax diversification in retirement.