Word: low-cost
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...million Number who are eligible for free or low-cost insurance but remain uninsured...
...part of the growing importance of individual investors, who want easy, flexible, low-cost diversification. For now, all the action in tradable, pre-fab stock portfolios is with index funds, which are more readily priced tick by tick because they hold the same stocks a long time. Eventually, though, actively managed mutual funds will be continuously priced--and actively traded...
...most of your life, building a nest egg by investing regularly in a 401(k) or Roth IRA or low-cost variable annuity is a no-brainer. You get decades of tax-free growth (returns on stocks have averaged about 11% annually the past few decades), and in the case of a 401(k), you also get an up-front tax deduction. Try getting that in a taxable stock mutual fund at Fidelity or Vanguard. Those of you who get a matching contribution from your employer can count additional blessings...
...equation starts to shift, though, as you near retirement age. In some cases, late in your career--say, five years from retirement--it makes sense to stop contributing to tax-deferred accounts and stash your money in a taxable low-cost stock-index fund instead. Why? Because the compounding effect of tax-free investing needs years to overcome the higher tax rate applied to such accounts at the time of withdrawal. And taxable accounts get the benefit of skipping capital-gains tax altogether when the account changes hands at death...
...Here's what her last five years' worth of contributions would net on an after-tax basis: $157,400 from a 401(k) with an average match; $121,000 from a 401(k) with no match; $102,300 from a taxable stock fund, and just $93,087 from a low-cost variable annuity. The 401(k) with a match is a clear winner. (If your employer doesn't match, maybe you should find one that does.) But the difference between the no-match 401(k) and the taxable fund is not all that great and may not be enough...