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"Looking for some other options I have been looking at Annuities. I thought that I had read you can have an " accumulation period " of up to 20 years. ( can't find where I read that). I have also ready that there is a penality if you with draw before age 59 1/2."

Investing in individual stocks and holding them for a long, long time is one approach to minimizing year to year tax consequences in non-retirement accounts. If individual stocks make you nervous (they are only a small part of my overall portfolio), look at low-turnover or tax managed mutual funds. There's been a lot of news lately about high taxes on mutual funds, but that's the high turnover (trading) funds that have become popular because they promise huge gains. Be careful to check details on fund turnover rates and capital gains tax history. You will have to long term pay capital gains taxes when you sell the fund, but year to year taxes on a low turnover fund are much less than you'd pay on CDs and, except during down markets, the returns are better. But I'd be sure you also keep a reasonable amount of money in safe investments (like CDs or Money Market) so you don't get stuck having to sell stocks or mutual funds during a down market.
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