What Are The Different Reasons To Open A General Investing And/or A Retirement Investing Account?
Posted by admin on November 6th, 2009 at 02:45am
On Vanguard it has a “General Investing” account and a “Retirement Investment” account. Obviously the latter is for IRAs, but what is the advantages and purpose of the general investing?
Tags: Account, And/or, Different, General, Investing, Open, Reasons, Retirement
Under Investing
2 Comments for What Are The Different Reasons To Open A General Investing And/or A Retirement Investing Account?
1. Ty C | November 6th, 2009 at 3:04 am
The main reasons are tax considerations.
In a retirement account, depending on how you set up the account, either the contributions can be tax deductible (traditional IRA) or the withdrawals are tax free (Roth IRA).
In a general investment account, depending on how long you hold on to the account, the earnings are either taxed as ordinary income (short-term) or taxed at the lower capital gains tax rate (long-term).
2. Steve | November 6th, 2009 at 3:04 am
If you have money eleigible to be protected under an IRA, you need to be there. General Investing designates that it’s non-retirement, non-tax protected. The advantages, beyond saving money, in the GI account, are whatever features that allow you to maximize your return while minimizing your risk.
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