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URL:  http://boards.fool.com/jerome-i-have-additional-money-that-i-could-29388185.aspx

Subject:  Re: Roth IRA $5000 distribution Date:  6/30/2011  1:28 AM
Author:  gdett2 Number:  268 of 294

Jerome,

I have additional money that I could invest, but thought it might be best to do it within my Roth IRA. Perhaps a taxable brokerage account should be my goal.

Tax-deferred accounts are almost always(there are exceptions) the best place to put money into for retirement investing. The growth, tax-free, over the years can make a big difference.

If you have maxed out all the legal contibutions to tax-free accounts, by all means, invest any remaining available cash into a taxable account. The nice thing about this is no limit on contributions. Of course, you need to understand the tax implications of sales.

If you end up in a position to retire before you are 59 1/2, money in a taxable account can be used for expenses. Withdrawls from IRAs and 401Ks before 59 1/2 may be subject to a 10% early withdrawl penalty. There are, of course, exceptions to that.

Another thing to keep in mind as you go forward investing, view all accounts as one pot. If you decide you want a certain percentage in stocks, bonds, etc, use the total of all accounts to calculate your percentages, not just your Roth or 401K.

Gene
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