6 Key Reasons Why Investing in a Taxable Account Is Underrated
Currently low tax rates are one of the key reasons that taxable accounts should be part of most investors' tool kits.
Investors are often schooled in the virtues of stashing money in tax-sheltered savings vehicles, whether IRAs, company retirement plans, 529s, or health savings accounts.
At a minimum, these savings wrappers all offer tax-deferred compounding--meaning you won't pay any taxes on a year-to-year basis as long as you don't withdraw any assets. And depending on the vehicle, you may also receive a tax break on your contributions and/or withdrawals, too. Those tax breaks can help enhance your take-home return--and that's nothing to sneeze at in an environment when future returns could be muted.