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|Subject: Re: Allocations across 401(k), taxable accounts||Date: 1/12/2005 5:51 PM|
|Author: DavidInTX||Number: 44006 of 73983|
"You don't have more money at the end of the period in a taxable account, but IF you have both, and you have stocks and bonds, the stocks are clearly better to hold than bonds in the taxable account."
That's what everyone says, I'm just having a hard time convincing myself of it.
I'm thinking of it this way: you have a marginal $1000 to invest, and it could go either place. In this case, it seems you're better off putting it your 401(k).
The other reply (from "IndecisiveFool") has got me thinking ... suppose you're in the fortunate scenario of maxing out your 401(k) *and* having an investment account. Then, your $1000 pre-tax capital will, by definition, be taxed. In that circumstance, you'd want to shift your bonds to the 401(k) as the Zweig suggested in his article.
So I suppose I just convinced myself.
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