Explanation:
To calculate your after-tax return on investment, we need to know your tax rate. Let's assume your tax rate is 20%.
Your total income from the salary and interest is:
$29,000 + $125 = $29,125
Your tax liability on this income is:
$29,125 * 20% = $5,825
So your after-tax income is:
$29,125 - $5,825 = $23,300
Your after-tax return on the investment is:
$125 / $23,300 = 0.0054 or 0.54%
Therefore, your after-tax return on the investment is 0.54%.