Investing 102

[GregWeld]

As long as we're on this subject --- I'd add that what you buy in which type of account is really pretty important.

Some things to think about when selecting.


IRA/ROTH etc --- what you put in here DEPENDS on your timeframe til retirement. Obviously if you have a long time -- say more than 15 years til retirement... then I'd personally select things that are more GROWTH oriented.


If it's money in a regular account --- and it's money that may or may not be tapped in to from time to time..... THEN I'd buy more steady eddies for that account.... because I might need the money when things are down. So the Cokes --- and that sort of name would be in my normal accounts.


A couple reasons here.... again --- just some food for thought. DIVIDENDS are taxable.... and GAINS aren't UNTIL YOU TAKE THEM. So in a normal account -- your money might DOUBLE over 10 years -- but you haven't been paying tax on that and won't until you sell. YOU WILL pay tax on the dividends even if you're having them re-invested.... at 20%. So you get 2K in dividends in that normal account and you're out of pocket $400 come tax day.


Now -- all of this DEPENDS --- like most things -- because nobody is doing or should be doing - what someone else is. It all has to be tailored to what your needs and goals are and your tax and cash flow situation is. I have NOTHING in IRA/401's -- I sold them out years ago because I had no need for them. I do still own an apartment house inside of an IRA -- and it's nothing but a PITA and is taxed as well! But that's a mistake on my part and I now can't seem to get out of it so it is what it is.