Taxable or Tax Deferred? Tax Deferred or Tax Free? For many investors, it isn't what you earn that counts, in the end it’s what you keep that matters. While taxes are inevitable, nobody enjoys losing money to the IRS, and if given the choice, most of us would probably opt to hold off on paying taxes for as long as possible. Thankfully, there's a way to do just that. It's called tax-deferred growth, and it's what enables your investments to grow over time without losing money to the IRS along the way. Tax-deferred growth is not subject to taxes immediately, but is instead taxed down the line. Here is the story of a Magic Dollar. A simple lesson of how impactful money growing tax-deferred growth really is!
LPL Financial does not provide tax advice. Clients should consult with their personal tax advisors regarding the tax consequences of investing.