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I've immersed myself lately in Investing and I think I have all the basics covered. I'm 27 and in addition to the joint roth my wife and I have we would like to start investing in separate accounts. We already have a savings account that has about 15k.

I guess I'm having a little bit of a disconnect when it comes to Index Funds. I have a Scottrade account where I can purchase index funds. The ScotTrade site is pretty intuitive and it clearly explains how to buy funds. Lets say I decide to buy VTSMX (Vanguard Total Stock Market Index Fund). Scottrade says I have to specify a dollar amount, lets pick a number, and just for the sake of this discussion lets say I buy $2000.00 worth, choosing to reinvest any gains I make on it.

Okay so I have 2000 in it. Now I know at Christmas I get a 3000 bonus, so I guess if I understand correctly I can add more money to my current VTSMX holding, as well as perhaps buying say $1000 of lets see, VBISX (Short term Bond)...Correct?

Now if I choose to reinvest my gains into the respective funds, what are the tax implications? I pay a lower rate on capital gains because I reinvested yea?

Additionally, as I grow older can I move existing amounts I have in these funds into other lower risk funds without any sort of hit from uncle Sam? (Note: I am using lower risk as an example, I am not implying the two symbols I have mentioned here are extremely risky)

Thanks for all your help.

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