Are tax-free returns better than taxable ones?

Taxable, tax-deferred and tax-free investments should be compared.

Tax-free investments have lower yields due to their tax-exempt status, but don't be fooled by the numbers. While taxable investments may seem like a better deal on the surface, they might not be ' especially if your marginal tax rate is relatively high. Use this calculator to see if a tax-free investment will give you a better yield than a taxable one.