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URL:  http://boards.fool.com/yes-i-did-overlook-the-consequences-of-having-to-14496511.aspx

Subject:  Re: Keogh makes No sense for S&P Index?? Date:  3/7/2001  5:05 PM
Author:  Venture123 Number:  91 of 294

Yes, I did overlook the consequences of having to gradually pull $66,000 out of my money market accounts. So I re-calculated based on what the $66,000 in money market would've appreciated to over a 25 year period.

Perhaps this is less fair than just reducing the intial sum to $134,000 to pay the taxes, but here is what my calculations are based on paying the IRS with existing Taxable Money Market funds:

In the example I used in which I invested in Index Funds within a Taxable Account, I would be paying $66,000 in taxes over a 25 year period, so this money would have to get taken out of my Taxable Money Market accounts gradually, (in order to pay the taxes while letting me contribute the same amount to my Taxable Index Funds, as I would've contributed to a Keogh).

I should have calculated how much this 66,000 ($2640 yearly payments to the IRS) taken out of Taxable Money Market funds would've appreciated, if I had just left it in Taxable Money Market instead of giving the IRS the money.

On a spreadsheet I calculated that if this Taxable Money Market ($66,000 in 25 yearly payments of $2640)grew at an average of 3% per year, after taxes, it would've apprecated to $99,140 over a