Need moral support--transfer from Edward Jones

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crosby
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Need moral support--transfer from Edward Jones

Post by crosby » Fri Jul 12, 2013 10:52 am

I've been a bogleheads site lurker for about a year. This morning I was finally ready to make the plunge. I have four accounts at Edward Jones totalling about 500k:
1. taxable account
2. complex trust account
3. Roth IRA
4. Inherited IRA
My holdings include innumerable American funds and some unit trusts. My plan was to sell everything at Edward Jones, transfer the money and start anew with Vanguard funds (3 fund portfolio); I decided I could handle the capital gains tax.

I've been holding off because I've been worried about the transfer--would my IRA not be transferred as inherited and I'll be hit with a big tax bill or would the trust not be properly transferred?

I called the Vanguard transfer department this morning and the young man told me that if I sold my funds and only had cash, I could not do a brokerage to brokerage transfer. He said I should move my money to a bank account and then do the transfer. I have no desire to move my trust, etc. to a bank account. Not only that, but I got the sense that he was young and inexperienced, that he talked down to me and was very impatient. Now I'm even thinking, well my Edward Jones broker is nice, smart and maybe it's worth the fees?

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Flobes
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Re: Need moral support--transfer from Edward Jones

Post by Flobes » Fri Jul 12, 2013 11:40 am

Here's my moral support. This is cut and pasted from a post I made just yesterday in another thread:
I made the move from Schwab to Vanguard several years ago, after many years at Schwab.

A Vanguard Certified Financial Planner worked with me (free) to create an investment plan. She had a Vanguard concierge assigned to me, and he set up my accounts (taxable, Roth and IRA) and then arranged all the logistics of moving the funds. Via a conference call, we -- the Vanguard concierge, a Schwab representative, and I -- went through the list of my Schwab holdings, and the concierge determined which funds were best sold on the Schwab side pre-transfer and which were best sold once they were at Vanguard. It was easy, respectful and painless.
Based on my experience, my advice is call Vanguard again. Clearly, somethings got lost in your previous conversation (not the least of which is your confidence). I would tell them there's a transfer of $500k in four accounts. It may or may not be cheaper for you to sell things on the Vanguard side; you might explore this. My concierge (that's was his Vanguard title) saved me some money, and he could not have been more thorough, diligent, professional, courteous, patient with my questions, and kind with my anxieties.

Glen O
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Re: Need moral support--transfer from Edward Jones

Post by Glen O » Fri Jul 12, 2013 12:19 pm

I moved a similar array of accounts to Vanguard earlier this year and found the Vanguard concierge service completely satisfactory. I had both cash and some muni bonds and both were able to be transferred by the inter-brokerage system. It can be faster to move cash through your bank account since the inter-brokerage takes about a week or so. One bond was called during the process and was returned to the original broker. The cash was later seemlessly swept over to Vanguard within a week.

Here are some thoughts on the various types of accounts:
Taxable -- I would sell the items you want where ever it is most convienient (or if there is a difference is less expensive)
Trust account -- Before putting anything in motion have the receipient Vanguard account set up and put under the appropriate name (of the trust) and then do a brokerage to brokerage transfer.
Inherited IRA -- Always transfer "Custodian to custodian" -- Once an asset leaves an Inherited IRA it never goes back and is taxed as a distribution.
Other IRAs -- Custodian to custodian is recommended to avoid any foul up that leaves you holding the bag with a tax bill.

I hope these ideas are helpful, I'm sure Vanguard will bend over backward to make the transfer work for you. If you are not happy with someone, ask for someone else. (But I doubt you will need to)

Glen

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ogd
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Re: Need moral support--transfer from Edward Jones

Post by ogd » Fri Jul 12, 2013 1:58 pm

crosby wrote:Now I'm even thinking, well my Edward Jones broker is nice, smart and maybe it's worth the fees?
Over time (thirty years), this nice and smart broker will take from you between one third and two thirds of your returns. It's not worth it.

I second the opinion above that Vanguard reps are normally very knowledgeable and efficient.
Last edited by ogd on Fri Jul 12, 2013 2:10 pm, edited 1 time in total.

barnaclebob
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Re: Need moral support--transfer from Edward Jones

Post by barnaclebob » Fri Jul 12, 2013 1:59 pm

Is it possible that the rep was confused when you presented your idea on how to transfer the accounts? I would first transfer them to vanguard as is and then buy/sell within the accounts through vanguard. You may not have to pay some fees to Edward Jones that way.

crosby
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Re: Need moral support--transfer from Edward Jones

Post by crosby » Fri Jul 12, 2013 3:27 pm

Thank you for your help. I spoke with a different Vanguard concierge and I have much more faith in him. I plan on selling my American Funds at Edward Jones (the ripping of the band aid method), and the concierge convinced me to have a Vanguard brokerage account at least until I choose my Vanguard mutual funds. I thought a brokerage account would cost extra money, but apparently it does not if I move money from cash to Vanguard funds. I'm interested in hearing if anyone thinks my plan of action is not wise (I'm aware of and accepting of the capital gains tax I will pay). Otherwise, I'm glad of the moral support--it is a little nerve wracking to take such a big step.

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Flobes
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Re: Need moral support--transfer from Edward Jones

Post by Flobes » Fri Jul 12, 2013 3:44 pm

crosby wrote:Thank you for your help. I spoke with a different Vanguard concierge and I have much more faith in him.
Wonderful! It can be very scary making big moves. But your life is about to get simpler.
crosby wrote:and the concierge convinced me to have a Vanguard brokerage account at least until I choose my Vanguard mutual funds. I thought a brokerage account would cost extra money, but apparently it does not if I move money from cash to Vanguard funds.
My move involved creating three brokerage accounts as well as the three Vanguard accounts, in taxable, IRA and Roth. (I also has a SIMPLE which I was no longer funding at Schwab, and the concierge's wisdom was able to get that into the rollover IRA at Schwab, which saved me one $75 account closing fee for that SIMPLE acct). It's a weird Vanguard thing that you'll get used to: every fund type (ie IRA or taxable) will have both a Vanguard account for Vanguard funds and a brokerage account for anything not Vanguard. Also know that Vanguard will continue "sweeping" for any dividends you have coming.

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ogd
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Re: Need moral support--transfer from Edward Jones

Post by ogd » Fri Jul 12, 2013 3:45 pm

Glad you're feeling better about it! I am quite sure that you won't regret this decision.

The VBS account is free at asset levels above $50K ("Voyager" level) even if you don't do anything with it whatsoever. Coming from Edward Jones, it might take a while to get used to this low-fee / at-cost thing that Vanguard does :D

Your plan sounds fine to me -- it's what I did when I went to Vanguard (it wasn't EJ but similar). Paying capital gains eventually is not something you can avoid, and the benefit of deferment is generally overshadowed by the higher fees. Plus, it just feels good to not give them another penny of your savings.

I don't know what it costs to sell out of your position at EJ, but I'm assuming that the concierge does and they told you what works best.

JW-Retired
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Re: Need moral support--transfer from Edward Jones

Post by JW-Retired » Fri Jul 12, 2013 3:59 pm

I would do it one step at a time to make the communication between you and VG less prone to misunderstandings. Do the Roth today, do the taxable next week when the Roth transfer is all done the way you intended, and so on with the other accounts. This should make it less daunting to get going.

This is a recent thread on an EJ to Vanguard transfer.
JW
Retired at Last

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Murray Boyd
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Re: Need moral support--transfer from Edward Jones

Post by Murray Boyd » Fri Jul 12, 2013 4:44 pm

crosby wrote: My holdings include innumerable American funds and some unit trusts. My plan was to sell everything at Edward Jones, transfer the money and start anew with Vanguard funds (3 fund portfolio); I decided I could handle the capital gains tax.
Do not do this! Edward Jones will murder you on fees. Transfer everything to Vanguard first and then start dealing with it.

At half a million qualify for Vanguard Voyager Select. Give them a call:

https://investor.vanguard.com/what-we-o ... t-services

crosby
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Re: Need moral support--transfer from Edward Jones

Post by crosby » Sat Jul 13, 2013 8:09 am

Thank you for the warning. I paid a front-end load when I bought my American funds, so I was assuming there would not be a sales fee. But I'll research it further.

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frugaltype
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Re: Need moral support--transfer from Edward Jones

Post by frugaltype » Sat Jul 13, 2013 8:29 am

The Vanguard folks who initially answer the phones are nice, but mention IRA to them and they will immediately transfer you to someone very knowledgeable about IRAs. Ditto brokerage questions to a broker.

The first Vanguard guy you spoke to sounds very atypical.

The Vanguard more knowledgeable folks should handle the transfers properly.

I would not sell anything until you have it at Vanguard.

Let Vanguard initiate/pull the transfers, don't let Edward Jones push them.

You will, if I recall correctly, have to give Vanguard either a copy of a few pages (front and signature page) for the trust or a copy of the whole trust document. That's standard with any company, in my experience.

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JamesSFO
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Re: Need moral support--transfer from Edward Jones

Post by JamesSFO » Sat Jul 13, 2013 8:32 am

crosby wrote:Thank you for the warning. I paid a front-end load when I bought my American funds, so I was assuming there would not be a sales fee. But I'll research it further.
My $0.02 from having helped my parents consolidate and simplify at Vanguard is move one account at a time. You have ~4 or so different accounts, and it is easy for _you_ to mix up the paperwork vs. doing one this week, having it come over safely. Then one a week later, etc.

We did this with my parents and while each step went smoothly it really re-assured them to see the funds show up.

dbr
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Re: Need moral support--transfer from Edward Jones

Post by dbr » Sat Jul 13, 2013 9:01 am

crosby wrote: I called the Vanguard transfer department this morning and the young man told me that if I sold my funds and only had cash, I could not do a brokerage to brokerage transfer. He said I should move my money to a bank account and then do the transfer. I have no desire to move my trust, etc. to a bank account. Not only that, but I got the sense that he was young and inexperienced, that he talked down to me and was very impatient. Now I'm even thinking, well my Edward Jones broker is nice, smart and maybe it's worth the fees?
This sounds like an inexperienced CS rep responding to what you said, which might have been a bad plan in some of its components, when he should have backed up and started from the beginning getting correct information about your situation. At the least he should have forwarded you to people more capable of managing. That is not how a competent company does business.

Based on other replies in this thread things will probably go well once you are working with the right people. I agree it could be good advice to handle things one account at a time. It could take weeks, but is a better idea.

It is true, by the way, that accounts that are invested in Vanguard funds and ETF's can be held and managed at low cost at financial companies other than Vanguard, but there are no promises that there cannot be problems moving accounts around anywhere.

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Flobes
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Re: Need moral support--transfer from Edward Jones

Post by Flobes » Sat Jul 13, 2013 9:25 am

Crosby,

About the transfer: The Vanguard guys really are pros. I moved all of my accounts at once, and nothing went wrong. My concierge stayed on top of each and every detail. You can monitor it all online, for assurance. Why devote a month of your life to a process that can be handled in days?

About the selling: In my experience, my concierge determined that a number of my funds were best sold on the Schwab side, saving me selling and transaction fees. And I had two funds that had to be sold on the Schwab side, because Vanguard doesn't handle them. Of course, Edward Jones is not Schwab.

About your status: there's been mention that you'll be Vanguard Voyager Select. This will happen once you have $500k in Vanguard funds, not when you have $500k in Vanguard accounts. So just bringing the funds over will not get you to Select status, with its lower transaction fees. If you work with your concierge on the selling, you'll get help selling enough to get to Voyager status, and the concierge can instantly make you Voyager, which will reduce the transaction fees on next round of sales. Then, once you sell more, the concierge will instantly make you Select.

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frugaltype
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Re: Need moral support--transfer from Edward Jones

Post by frugaltype » Mon Jul 15, 2013 12:31 pm

Flobes wrote:Crosby,

About the transfer: The Vanguard guys really are pros. I moved all of my accounts at once, and nothing went wrong. My concierge stayed on top of each and every detail.
I forgot the concierge folks. I forget what you have to do, if anything, to qualify for that, but they really do do all the worrying and tracking for you, and you have a direct phone extension to your concierge.

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