Most investors focus on what to buy — stocks, bonds, the classic 3‑fund portfolio. But very few think about where those investments should live. And that “where” quietly affects your taxes every single year.
I’ve written before about how smart asset location can boost long‑term returns. I also compared my approach with what Google Gemini suggested for the same $1 million sample portfolio. This time, I wanted to make the whole idea more hands-on. So I built an interactive Asset Location Optimizer using Google AI Studio.
The tool takes three ETFs — VTI, VXUS, and BND — and figures out the most tax‑efficient way to spread them across a Taxable account, Roth IRA, and Traditional IRA. It reads your balances, applies your target allocation, and shows you exactly how much tax drag you’re paying today versus what you could be paying.
In the sample case, the optimized setup cuts annual tax drag from $1,674 to $585 — a savings of $1,089 per year. Let that compound for 30 years, and it adds up to $195,691 in extra wealth.
The logic behind the tool is simple:
Bonds (BND) go in the Traditional IRA because bond interest gets taxed at ordinary income rates.
International stocks (VXUS) go in the Taxable account to capture the Foreign Tax Credit.
US stocks (VTI) go in the Roth IRA to maximize tax‑free growth.
Any leftover VTI fills the remaining space.
You still end up with the same overall 48/12/40 allocation — just arranged in a smarter way.
I built the entire app using prompts (aka vibe coding) in Google AI Studio, and it turned out to be a great educational tool. It makes asset location visual and intuitive, and it shows how much taxes quietly eat into returns. It’s not a replacement for a CPA, but it’s a great way to understand the power of putting the right assets in the right accounts.
The screenshots below show the tool in action. The tool also includes an AI Chat Advisor that explains the math, tax logic, and decumulation strategies.
Disclaimer: This article is not intended to be investment advice. Consult a duly licensed professional for investment advice. The contents of this article are for educational purposes only and do not constitute financial, accounting, tax, or legal advice. Past performance is no guarantee of future results.
