It's tax planning season! You are trying to get all the exemptions and deductions that you can claim so that you are paying only the bare minimum tax requirement. At the end of the exercise, during filing the tax returns, you will know your effective tax rate . This rate can vary from 10% to 40%. Let's consider an average 30% Federal (including Social security and Medicare, don't forget these taxes!). In states like California, you are paying additional 10% State income tax . So your effective tax rate becomes 40% . It is definitely painful to shell out this much of your hard earned money. But it doesn't stop there. Add property tax on your house. Assuming $200K income and a $1MN home price, 1% property tax means $10,000 or 5% of the income. Your tax bill has already grown to 45% . If you are renting, your landlord will make sure to pass on the property tax they are paying, on to you. That's not enough either. Now let's assume that you are able to save 5% of...