Taxable vs. Tax-advantaged: Where to Hold Investments

//Taxable vs. Tax-advantaged: Where to Hold Investments

Taxable vs. Tax-advantaged: Where to Hold Investments

When investing for retirement or other long-term goals, people usually prefer tax-advantaged accounts, such as IRAs, 401(k)s or 403(b)s. Certain assets are well suited to these accounts, but it may make more sense to hold other investments in traditional taxable accounts.

Some investments, such as fast-growing stocks, can generate substantial capital gains, which may occur when you sell a security for more than you paid for it.

If you’ve owned that position for over a year, you face long-term gains, taxed at a maximum rate of 20%. In contrast, short-term gains, assessed on holding periods of a year or less, are taxed at your ordinary-income tax rate — maxing out at 37%. (Note: These rates don’t account for the possibility of the 3.8% net investment income tax.)…Read The Rest at BSGM

2018-11-01T15:56:30+00:00November 1st, 2018|Categories: Member Firm News|Tags: , |