[quote=Eugene]Always remember about taxes … if it’s a retirement account, you’re okay … if it’s not, you’ll pay 35-40% in taxes on any gains you make. And, if you bought a house or intend to buy a house this year, capital gains due to the sale might just be enough to kick your AGI above the $8000 tax credit eligibility threshold. You should always do the math.
If you’re investing outside 401k/IRA, it may be more profitable to wait out a small correction long stocks till you lock in the LTCG status, than to bail at the first sign of danger.
On the subject of feelings, I fully understand your feelings, but my rational side tells me that the stock market has enough strength left for one more rally. Maybe I’ll exit in October.[/quote]
I’m not selling a house, just trying to pay it off. It was bought way back in ’96 and this one set me back way more than the pittance I made on the previous one.
I’m with you on trying to stretch it to the LTCG threshold. I’ve been burned trying to do that in the past however, sometimes it’s better to take the tax hit than watch any gains and your principal go down the tubes. BTDT the T shirt fell apart already.
I think I still have some previous losses I can carry over to help anyway.
I’m with Eugene on the possibility of a fall rebound. A lot of maybes have to happen but reality doesn’t seem to apply anymore so I’ll just decline to fight that trend and see if I can milk it for all it’s worth.
Who’s running the odds on a major drop because no one will hold over the long Labor Day weekend?
