How investors can build a tax-efficient portfolio

Watch on YouTube ↗  |  January 08, 2026 at 20:17  |  4:22  |  CNBC
Speakers
Sharon Epperson — Senior Personal Finance Correspondent

Summary

CNBC Power Lunch discusses tax-efficient portfolio planning with senior personal finance correspondent Sharon Epperson. She highlights 2026 increases in IRA and 401(k) contribution limits, the new requirement that catch-up contributions for those 50+ be Roth, and the value of after-tax 401(k) to Roth conversions where plans allow them. She also explains asset location—stocks in Roth accounts and fixed income or municipal bonds in taxable accounts—and notes tax-loss harvesting is important.

  • Tax filing season starts Jan 26, deadline Apr 15.
  • Sharon Epperson says investors should first review tax-advantaged accounts.
  • 2026 IRA limit rises to $7,500; 401(k) limit rises to $24,500.
  • Catch-up contributions for age 50+ must be Roth starting this year.
  • Some plans allow after-tax 401(k) contributions and Roth conversions.
  • Asset location matters: stocks in Roth, fixed income/munis in taxable.
  • Tax-loss harvesting can offset gains; tax-gain harvesting mentioned but cut off.
Ideas
Sharon Epperson Senior Personal Finance Correspondent 0:42
Maximize tax-advantaged retirement account contributions
With 2026 tax-advantaged account contribution limits increasing, Epperson says investors should first review and maximize accounts like IRAs and 401(k)s. The IRA limit is $7,500 with a $1,100 catch-up for age 50+, while 401(k) limits are $24,500 with an $8,000 catch-up for 50+ and $11,250 for ages 60-63. These accounts are a great place to start or supplement workplace plans for retirement savings.
ICLN Roth IRA 401(k) HIGH
Sharon Epperson Senior Personal Finance Correspondent 2:19
Catch-up contributions must now be Roth
Epperson warns that starting this year, catch-up contributions for investors age 50 or older must be made as Roth contributions, so savers no longer get an upfront tax break on those catch-up dollars. She says this change should be considered when deciding tax strategy and where to put money.
Roth 401(k) HIGH
Sharon Epperson Senior Personal Finance Correspondent 3:39
Convert after-tax 401(k) to Roth
Epperson says investors should check whether their workplace plan allows after-tax 401(k) contributions and in-plan Roth conversions. If the plan permits it, converting after-tax contributions to Roth is a great tax-efficient strategy, but not all plans offer the feature, so investors must verify with the plan sponsor.
After-tax 401(k) HIGH
Sharon Epperson Senior Personal Finance Correspondent 3:46
Place stocks in Roth, bonds taxable
For tax-efficient investing, Epperson says asset location matters as much as asset allocation: hold stocks in a tax-free growth and withdrawal account like a Roth account, while placing fixed income or municipal bonds in a taxable account, because different assets have different tax treatment.
STOCKS TLT MUB HIGH
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This CNBC video, published January 08, 2026, features Sharon Epperson discussing ICLN, Roth IRA, 401(k), Roth 401(k), After-tax 401(k), STOCKS, TLT, MUB. 4 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Sharon Epperson  · Tickers: ICLN, Roth IRA, 401(k), Roth 401(k), After-tax 401(k), STOCKS, TLT, MUB