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Author: JeanDavid Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 74759  
Subject: Re: 401(k), IRA or Foolish Four? Date: 9/16/1997 9:46 PM
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<You wrote: <(you might consider one of the UV plans instead, such as the UV4+)>

What is a UV* plan? >

You can find them in the Foolish Workshop, listed at the left of the main M.F.page. Under Foolish Workshop is an entry for Workshop Info. Under that is an entry for Unemotional Value. Look in there.

<You wrote: >While you could invest in the Foolish Four outside of an IRA or 401(k), the tax consequences will be unfavorable if you intend, and do, keep the money in there until retirement.>

What are the tax consequences if I stay invested in the Foolish Four until retirement?>

Each 18-months, when you rebalance your portfolio, if all is going well, you would need to pay capital gains tax (20% if you wait 18 months and a day each time to rebalance) that, in an IRA would remain inside, earning you even more money. Over the years, this mounts up. On retirement, you will pay,
probably 28% (whatever your normal rate will be then) on your distributions. Problem is if you do not wait until you are 59 1/2, you get to pay your 28% now and an additional 10% excise tax for taking it out too soon.
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