Tackle Today: Choosing Account Types | Tackle Trading: The #1 rated trading education platform

Tackle Today: Choosing Account Types

Tackle Today Choosing Account Types scaled

«Behold, your choices.»

Traders,

There are many account types available to the everyday trader. But they fall into three categories: taxable, tax-deferred, and tax-free. Here’s how each works.

Taxable: You pay taxes on interest, dividends, and any realized capital gains each year. It’s a pain in the neck and takes a bite out of your growth – particularly if you’re incurring short-term capital gains, which are taxed at your ordinary income tax rate. What’s the upside? The money is liquid, so you can access it whenever you want, just like your bank account.

Tax-Deferred: This bucket includes a broad swath of retirement accounts: 401k, IRA, TSP, 403b, etc. The tax owed on interest, dividends, and gains doesn’t have to be paid until you withdraw money from the account (typically in retirement). Avoiding the annual tax bite allows your money to grow more. What’s the downside? They’re supposed to be illiquid, and in most instances, you pay a penalty if you access the money before age 59.5.

Tax-Free: We’ve saved the best for last. These are known as ROTH accounts, and they allow you to dodge paying ANY taxes on interest, dividends, and capital gains. The best account type varies depending on individual circumstances. Many investors use all three account types to achieve tax diversification and have more options.


Video Of The Day: Queen’s Court – Covered Call Analysis on $OXY: Cover or Not?

On today’s Queen’s Court, coaches Emily and Matt have a discussion on whether to write a Covered Call or not on $OXY. Watch this Covered Call Analysis on $OXY.


Chart of the Day: When the S&P 500 is down 25% or worse Since 1950

Forward returns look mighty fine after a 25% decline. History demands optimism at these levels if you’re a long-term investor.


Today’s line up

Traders Lounge 11 AM EST

Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.

The Coaches Show Replay

If you missed last night’s episode where Coach Mark discussed Trading Psychology or would like to watch it again, check it out here.

Halftime Report 12:30 PM EST

The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.

Trade Masters 7:00 PM EST

Every Wednesday at 7 PM EST join us on the Trade Masters where two Coaches go head-to-head to see who can find the best trading setup.


Trading Justice Podcast: Each week your hosts guide you on a journey of financial education.

Trading Justice 497: What to Expect in Earnings Season

What is a critical earnings season for the markets in the face of tremendous uncertainty?

Listen to this episode in the player below.


Tackle Trading: Financial Freedom is a Journey. Sign up now for a 15-day free trial.

Financial freedom is a journey

Sign up now and gain unfettered access to all of the quality content and powerful Scouting Reports that our Pro Members enjoy for 15-days absolutely free with no strings attached and let us show you what your trading has been missing.


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