What is Tax-advantaged account?
A tax-advantaged account is an investment or savings account that the tax rules treat more gently than an ordinary account. Depending on the account, money may go in before tax, grow without yearly tax on income and gains, or come out tax-free. In return there are limits on how much can go in and rules about when and why money can come out.
Why Tax-advantaged account matters
Two people holding the same investments can keep very different amounts after tax, depending only on the account the investments sit in.