efflandt
Senior Member
Cash: $ 80.45
Posts: 401
Joined: 25 Apr 2005
Location: Elgin, IL USA
|
One option may be stocks that pay a "qualified" dividend, which is taxed at a lower long term capital gains rate than fixed interest or bond interest. Just be aware that some dividends are not "qualified" and would be subject to full tax. Or if you have dividend paying stock in a margin account and that stock is loaned out to someone who shorts it, you may get a substitute dividend from the person who shorted it, that could be fully taxed. That would not happen in a cash (non-margin) brokerage account.
Although, in current uncertain markets I am not sure what can be counted on to pay increasing dividends and appreciate in value.
Some mutual funds are tax managed with minimal turnover for minimal capital gains tax. You would want to stay away from funds that do a lot of trading within the fund (turnover) which can pass on short term gains to you, even if the fund itself does not gain or loses value.
|
