Quote:
Originally Posted by lewdog
LOL. Ok. I wasn't sure but that's what I am reading.
Some people are parking some extra money, in something like a short term bond fund or money market in hopes of gaining a bit of tax free money but also something low risk with fairly immediate access to cash in an emergency. People are claiming this is in addition to a taxable emergency fund such as a savings account which generates little interest but is also taxed. Build this small emergency fund in your Roth to something like an extra $10k over the duration of a few years and then start putting your entire yearly contribution into a Roth back to all retirement funds. Gives you a little bit of extra liquidity without being taxed if you had to touch it later, with the hope that you don't have to.
I guess that's the point?
|
You can invest it in the stock market as well. That said, I would rather keep my Roth contributions protected and earning moar tax free gains, so maintaining some healthy savings balance seems prudent.