move or liquidate Ameriprise SPS mutual funds?

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Joined: Tue Jul 09, 2013 5:54 pm
Location: Oregon

move or liquidate Ameriprise SPS mutual funds?

Post by trivets » Tue Jul 16, 2013 11:28 am

Hi Everyone,

Last month I read the "Bogleheads guide to Investing" and the "Coffeehouse Investor" and I've been lurking on this board for a few weeks, while also trying to get out of the mess created in the Ameriprise accounts my partner and I have been investing in. I'm hoping for some help making a decision about what to do with my mutual funds at Ameriprise.

My partner had a significant portion of her retirement in a Traditional IRA and Roth IRA, all of it is at Ameriprise. Last week, she began the process of transferring it all over to Vanguard. That's the easy part.

We also have 10 laddered CDs at Ameriprise in an SPS account getting 1.5% return. I've arranged to cash out each one when it is due and will move them into something at Vanguard. But this will take a year to do. So we will still be tied to Ameriprise during this time.

I have my own Taxable mutual funds at Ameriprise SPS. And they are not good funds -- high loads (sunk costs, I know) and high fees.
MDFGX -- 1.09% expense ratio
EHSTX -- .99% expense ratio
FSCDX -- 1.06% expense ratio
FSTAX -- .98% expense ratio (these are the only bonds I have at Ameriprise)
OIGAX -- 1.28% expense ratio

I have a 401k of my own with Fidelity where the majority of my retirement lives (and has way too many funds, but I will fix that), but my main concern is what to do with these mutual funds right now knowing that transferring them inkind to Vanguard may be possible, but I will incur a charge from Ameriprise to transfer and they will still be costing me in fees. But cashing them out will create a taxable event (I'm in the 25% fed tax bracket and 9% OR state). My goal for these funds is to eventually cash them out and put them all in Index funds.

But also, our Ameriprise advisor is going to lose the bulk of her business with us when the IRAs are transferred to Vanguard this month, so I feel like I need to do something with mutual funds soon. Also, the gains are being reinvested so I know if I cash it out, some gains will be short-term.

What is the best option?
Should I see if I can transfer them inkind to Vanguard and then arrange to stop reinvesting gains and wait to cash them out? Or should I just liquidate at Ameriprise and get this all over with? Or something else entirely?

Thanks so much

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