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Subject:  Re: nondeductible IRA - Useless? Date:  12/21/2004  4:46 PM
Author:  Mark0Young Number:  43668 of 88492

I haven't run the numbers, but I would be inclined to agree with you: a non-deductible contribution to a Traditional IRA doesn't make sense under current tax laws if one is going to be holding a tax-efficient investment (like the Vanguard Total Stock Market Fund) inside the IRA.

But tax-inefficient investments would make sense in a Traditional IRA funded with non-deductible contributions, like you mentioned. That would include bonds and bond funds (other than municipal bonds), REITs.
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