Savings Breakdown

Ok, so at least my Vanguard accounts started to gain some money. I just realized that I have no idea how my VGMIX Mutual Fund account will be taxed. Do I get taxed when I take out the money or do I get taxed each year on capital gains, even if ultimately I could lose that money before taking it out of the account? There’s probably a simple answer for this, but as of now I’m clueless.

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3 thoughts on “Savings Breakdown”

  1. Unfortunately, you will get taxed on all dividends in the year you received the payout(even if you automatically reinvested dividends). Taxes breakdown this way – dividends and short term capital gains get taxed as ordinary income (taxed at your personal tax rate) and log term capital gains are taxed at 15%.You are correct – you could owe taxes even if you ultimately lose money in the fund. Whenever possible, a good rule of thumb is to buy mutual funds soon after dividend date (don;t buy the taxable distribution) and sell before,

  2. Also, you should be able to beat those rates on CDs, or on Money Market Accounts or Internet Savings Accounts.Check out for the latest rates

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