No matter what you're investing for, there comes a time when you need to withdraw money from a brokerage account.
- Purchasing your first home.
- Paying for educational expenses.
- Paying for medical expenses.
- Supporting yourself because of a disability.
What happens when you take money out of an investment account?
Withdrawals are subject to ordinary income taxes, which can be higher than preferential tax rates on long-term capital gains from the sale of assets in taxable accounts, and, if taken prior to age 59½, may be subject to a 10% federal tax penalty (barring certain exceptions).
How long should I hold my investments for?
Though there is no ideal time for holding stock, you should stay invested for at least 1-1.5 years. If you see the stock price of your share booming, you will have the question of how long do you have to hold stock? Remember, if it is zooming today, what will be its price after ten years?