Here we go again with another week. I thought I'd kick off the week with another Monte Carlo Monday.

Depending on who you talk to and how they calculate it, we're right now in the so-called "tax freedom day" area of the calendar year. That's the hypothetical day when your earnings to date equal your total tax liability for the year. So if you're in the 28% tax bracket, as so many are, your hypothetical tax freedom day is 28% of the way through the year. About now, give or take a few days.

It also means that if your tax rate is less than 28% your own tax freedom day was some number of days or weeks ago. Did you know that with a bit of research ahead of time you can not only move your tax freedom day to earlier in the year, but you can enhance your overall return on your investments?

Let's have a look:

This first chart is a Monte Carlo simulation of a hypothetical $10,000 investment over 25 years. The expected rate of return is 10% with a standard deviation of 12%. These are fairly typical numbers for a growth mutual fund. This particular hypothetical fund, however, is not very tax efficient. The fund manager routinely buys and sells according to whatever he thinks is hot. Consequently all his capital gains - which are really your capital gains - are taxed at regular income rates, in this case 28%.

Note that over a quarter of a century the Monte Carlo simulations say you'll do OK. But is OK really all that good?

Suppose our fund manager, instead of chasing the hot trends and driving up his fund's turnover rate, invests more for the long term. Letting the winners run and being more patient allows more of the securities in the portfolio to become long term investments. The difference is, of course, long term capital gains are taxed at a lower rate.

Let's say, for argument's sake, the effective tax rate on the combination of long and short-term buying and selling drops to 20%, down from 28%. The Monte Carlo simulation predicts a potentially dramatic effect on overall returns over 25 years.

This is why you want to look at a fund manager's portfolio turnover rate when you're buying into someone else's investment vehicle. His or her investment style may get you what looks like decent returns, but it may be possible to spice up those returns by giving some thought to the tax consequences of buying and selling.