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Author: TMFPixy Big gold star, 5000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75540  
Subject: Re: Fool4 Periodic Investing - How? Date: 6/26/1997 6:29 PM
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Yo, mastevens.

<<Bummer. I'd been hoping to save around $1,500 a month. Should I assume my best bet is to go ahead and roll the 403(b) into an IRA and continue annual $2,000 deposits but set up a new account as well (which will not be tax deferred)?>>

Well, that's really up to you. The $2K will be a non-deductible contribution, which means you'll have to file Form 8606 with your tax return each year to keep track of them. You also want to keep a copy of that form forever because it's the best proof you'll have to prove it's already been taxed when the money starts coming out of the IRA. That's not a big deal, but it is a pain in the rear. See IRS Pub 590 (Individual Retirement Arrangements) for details.

I think your idea of using a taxable account for the rest of your monthly deposits is a great idea. The more and the earlier you set aside funds for retirement and other things, the better.
With compounding, the more time you have the larger the end result will be. I do something similar, and then I treat my tax deferred and taxable accounts as one big portfolio to divvy up my trades. Works for me, so it probably would for you as well.


Regards.......Pixy
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