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Originally Posted by redpoint5
I'm very new to 401k, so I may be mistaken, but I thought there were no capital gains when transferring the investment vehicle from one form to another, such as stocks to bonds. Wouldn't gains tax only apply if the funds are liquidated?
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You're correct about 401k and traditional IRAs - at least as far as I know, but I'm neither an accountant nor a tax lawyer - but I thought we were discussing investments in general. I'd expect many people have both: the retirement accounts that can't be touched until age 59 1/2 (or whatever) without paying a significant penalty, and ordinary investment accounts that you can withdraw any time, where your capital gains & dividends are taxed.
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I just fundamentally am against zero-sum systems like the stock market. For you to gain money, someone has to lose, or the perceived value of the company has to perpetually increase.
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But the stock market is not a zero-sum game. Even if stocks never change in value, they still pay dividends. And stocks do increase in value when their companies do more business and increase their markets.