Any issues with rollovers from Fidelity to Vanguard?
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Any issues with rollovers from Fidelity to Vanguard?
I've been on this forum for over half a year and decided that the most and most worthwhile feedback on investments have been discussed here. I appreciate all of the back and forth with differing opinions as well as appropriate references that have been invaluable.
OK, on to it.... This may have been a one-time, unintentional issue where I got screwed but need to get validation that it was just a one-timer. Need to vent and get a pulse check. Just a trifle PO'd at this time.
25July. Initiated a rollover of my 3 separate employer 401K's with Fidelity over to Vanguard. They would not transfer directly, but sent the checks to me. Two of them had after-tax funds, so the rollover should have been 5 separate checks (three pre-tax into a regular brokerage IRA and two designated after-tax to a Roth IRA confirmed during the call.)
27July. I received the appropriate checks for two of the accounts on ( one went to a brokerage IRA,one to a brokerage and one to the Roth). The third account did not separate checks into the regular IRA and the Roth. They were lumped together.(This was well over a half-million dollars)
As soon as I saw the checks and breakdown I called Fidelity. Three reps later, they told me they needed a day to review the phone tapes and determine what to do.
28July. They determined that I should have been sent two checks. It would take possibly a week to get things straightened out and issue me separate checks.
31July. Update today was that they will be issuing separate checks after they finish an "audit". The audit should be done by tomorrow and they should cut my checks maybe by Tues-Wed, 1-2Aug and probably get to me by Friday, 4Aug. Depending on the time of day, by the time I receive them, package them up, received by Vanguard via FEDEX could be as late as next Tues-Wed, 8-9 Aug . So, about two and a half weeks after my Fidelity rollovers were initiated. Lot of activity in the financial markets since last week.
I really don't feel that this is an appropriate amount of time to have someone holding on to my 600k+ before I have access to reinvest.
Suggestions? Comments? Recommendations? Recourse? Are my expectations overblown?
Again, appreciate the varied experience of every contributor.
OK, on to it.... This may have been a one-time, unintentional issue where I got screwed but need to get validation that it was just a one-timer. Need to vent and get a pulse check. Just a trifle PO'd at this time.
25July. Initiated a rollover of my 3 separate employer 401K's with Fidelity over to Vanguard. They would not transfer directly, but sent the checks to me. Two of them had after-tax funds, so the rollover should have been 5 separate checks (three pre-tax into a regular brokerage IRA and two designated after-tax to a Roth IRA confirmed during the call.)
27July. I received the appropriate checks for two of the accounts on ( one went to a brokerage IRA,one to a brokerage and one to the Roth). The third account did not separate checks into the regular IRA and the Roth. They were lumped together.(This was well over a half-million dollars)
As soon as I saw the checks and breakdown I called Fidelity. Three reps later, they told me they needed a day to review the phone tapes and determine what to do.
28July. They determined that I should have been sent two checks. It would take possibly a week to get things straightened out and issue me separate checks.
31July. Update today was that they will be issuing separate checks after they finish an "audit". The audit should be done by tomorrow and they should cut my checks maybe by Tues-Wed, 1-2Aug and probably get to me by Friday, 4Aug. Depending on the time of day, by the time I receive them, package them up, received by Vanguard via FEDEX could be as late as next Tues-Wed, 8-9 Aug . So, about two and a half weeks after my Fidelity rollovers were initiated. Lot of activity in the financial markets since last week.
I really don't feel that this is an appropriate amount of time to have someone holding on to my 600k+ before I have access to reinvest.
Suggestions? Comments? Recommendations? Recourse? Are my expectations overblown?
Again, appreciate the varied experience of every contributor.
Re: Any issues with rollovers from Fidelity to Vanguard?
I had Fidelity mess up a transfer from TIAA to Fidelity, so I have less confidence in them than many here (and it involved being forced to cash, so being out of the market is the big issue).
The number one danger in any transfer is being forced to cash, and being out of the market. Transfer in kind whenever possible, but I realize sometimes it's just not possible, in which case you want to minimize time out, maybe break into smaller chunks, and try to forsee any screwups before they happen.
For transferring out of Fidelity, I wonder if it's best to first go to Fidelity IRA as a stepping stone. Maybe you could have moved in kind (and had pre/post tax separated correctly). Then move from there. That's what I plan to do with my Fidelity 403b.
The number one danger in any transfer is being forced to cash, and being out of the market. Transfer in kind whenever possible, but I realize sometimes it's just not possible, in which case you want to minimize time out, maybe break into smaller chunks, and try to forsee any screwups before they happen.
For transferring out of Fidelity, I wonder if it's best to first go to Fidelity IRA as a stepping stone. Maybe you could have moved in kind (and had pre/post tax separated correctly). Then move from there. That's what I plan to do with my Fidelity 403b.
- Earl Lemongrab
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Re: Any issues with rollovers from Fidelity to Vanguard?
What are you looking for? Sympathy, or do you think there is something actionable? Are you going to try to get Fidelity to give you some money? It's unpleasant when mistakes happen, but with something like this the likely best you can hope for is that they fix it and give you what you wanted.
If it had been me, I wouldn't have tried so many transactions at once unless that's the only way they'd do it. With rollovers out of a 401(k), I try to make it so that only fixed-income is affected, so that I'm not out of the stock market for an extended period.
If it had been me, I wouldn't have tried so many transactions at once unless that's the only way they'd do it. With rollovers out of a 401(k), I try to make it so that only fixed-income is affected, so that I'm not out of the stock market for an extended period.
Re: Any issues with rollovers from Fidelity to Vanguard?
I thought transfers were done by "pulling" from the destination side. No?
Get most of it right and don't make any big mistakes. All else being equal, simpler is better. Simple is as simple does.
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Re: Any issues with rollovers from Fidelity to Vanguard?
When I transferred money from my company Fidelity 401k (still kept some money in my company 401k since I'm still working) to send over to my Vanguard Rollover IRA, Fidelity followed the same process.
Fidelity would not send the money directly to Vanguard, but made the check out to "VFTC FBO billfromct", then I had to send the check to Vanguard with a cover letter as to what fund in my Rollover IRA Vanguard should deposit the check into.
My transfer was simple because it was just a regular tax deductible 401k.
The Vanguard rep was on the phone with me on my Fidelity call just in case, but it wasn't necessary.
I will have to admit that the Fidelity people were very helpful & polite.
bill
Fidelity would not send the money directly to Vanguard, but made the check out to "VFTC FBO billfromct", then I had to send the check to Vanguard with a cover letter as to what fund in my Rollover IRA Vanguard should deposit the check into.
My transfer was simple because it was just a regular tax deductible 401k.
The Vanguard rep was on the phone with me on my Fidelity call just in case, but it wasn't necessary.
I will have to admit that the Fidelity people were very helpful & polite.
bill
Re: Any issues with rollovers from Fidelity to Vanguard?
I think mistakes like this happen when it gets complicated.
I had Voya do a NUA on two stocks in my 401K. It has been 2 weeks and two "research" tickets and they are still not able to figure out what stock they gave me and it's cost basis. During the past two weeks I wanted to sell at a high -- lost that opportunity.
The thing is that they gave me 3 stocks, not 2 -- because during the 401K time one of the stocks split off and was acquired by another company -- but the documentation doesn't say that -- just my brokerage account. I basically think I am okay "in total" and the stocks are in my posession, but I need to know the basis of each stock to sell... arghh...
I had Voya do a NUA on two stocks in my 401K. It has been 2 weeks and two "research" tickets and they are still not able to figure out what stock they gave me and it's cost basis. During the past two weeks I wanted to sell at a high -- lost that opportunity.
The thing is that they gave me 3 stocks, not 2 -- because during the 401K time one of the stocks split off and was acquired by another company -- but the documentation doesn't say that -- just my brokerage account. I basically think I am okay "in total" and the stocks are in my posession, but I need to know the basis of each stock to sell... arghh...
Re: Any issues with rollovers from Fidelity to Vanguard?
Why is this a big deal? So what if you're out of the market for a few days, or even a couple of weeks?*3!4!/5! wrote:The number one danger in any transfer is being forced to cash, and being out of the market. Transfer in kind whenever possible, but I realize sometimes it's just not possible, in which case you want to minimize time out, maybe break into smaller chunks, and try to forsee any screwups before they happen.
Re: Any issues with rollovers from Fidelity to Vanguard?
It is the biggest deal in most investors' investing life. I cannot fathom why you would need to ask that question, but okay, I'll bite. It is huge risk and slightly negative expected reward. It's a terrible situation to be in. You could miss a market runup and literally lose a year's salary. It's a catastrophe. It's the same reasoning why you should hold rather than jumping in and out of the market, as the latter exposes you to huge risk.radnor wrote:Why is this a big deal? So what if you're out of the market for a few days, or even a couple of weeks?*3!4!/5! wrote:The number one danger in any transfer is being forced to cash, and being out of the market. Transfer in kind whenever possible, but I realize sometimes it's just not possible, in which case you want to minimize time out, maybe break into smaller chunks, and try to forsee any screwups before they happen.
- Earl Lemongrab
- Posts: 7270
- Joined: Tue Jun 10, 2014 1:14 am
Re: Any issues with rollovers from Fidelity to Vanguard?
Not with 401(k)s, as the plan rules often require starting the process with them. That's how Megacorp does it. Like other mentions, the only option is to fill out the form (web or print/mail) and get a check either made out to you or preferably to the new custodian FBO the account holder.GaryA505 wrote:I thought transfers were done by "pulling" from the destination side. No?
Re: Any issues with rollovers from Fidelity to Vanguard?
This is why I had Fidelity roll my 401(k) to IRA and ROTH at Fidelity and then a while later (few months) I initiated a custodian to custodian transfer from VG to Fidelity. I wanted Fidelity to own the outcome through at least one tax reporting cycle. I think it is best to minimize the number of factors in motion (location, tax attributes) when making moves. Custodian to custodian transfers have no tax reporting requirements so it is easier to get them done without risking a 1099-R screw up.
Stay hydrated; don't sweat the small stuff
Re: Any issues with rollovers from Fidelity to Vanguard?
That’s exactly my plan. Later this year (after taking the RMD) I plan to roll my Fidelity before tax 401k monies to a Fidelity IRA with after tax contributions going to a Roth. And next year transferring both IRA’s to Vanguard. If I might a couple procedure questions, can the Fidelity 401k to IRA moves be initiated on-line or …? And secondly, are the IRA transfers to Vanguard initiated on-line from Vanguard or …?jebmke wrote:This is why I had Fidelity roll my 401(k) to IRA and ROTH at Fidelity and then a while later (few months) I initiated a custodian to custodian transfer from VG to Fidelity. I wanted Fidelity to own the outcome through at least one tax reporting cycle. I think it is best to minimize the number of factors in motion (location, tax attributes) when making moves. Custodian to custodian transfers have no tax reporting requirements so it is easier to get them done without risking a 1099-R screw up.
Re: Any issues with rollovers from Fidelity to Vanguard?
I did the whole 401(k) -> IRA & ROTH with a Fidelity rep on the phone. Took about 15-20 minutes including the time to create the IRA/Roth accounts.JohnF wrote:That’s exactly my plan. Later this year (after taking the RMD) I plan to roll my Fidelity before tax 401k monies to a Fidelity IRA with after tax contributions going to a Roth. And next year transferring both IRA’s to Vanguard. If I might a couple procedure questions, can the Fidelity 401k to IRA moves be initiated on-line or …? And secondly, are the IRA transfers to Vanguard initiated on-line from Vanguard or …?jebmke wrote:This is why I had Fidelity roll my 401(k) to IRA and ROTH at Fidelity and then a while later (few months) I initiated a custodian to custodian transfer from VG to Fidelity. I wanted Fidelity to own the outcome through at least one tax reporting cycle. I think it is best to minimize the number of factors in motion (location, tax attributes) when making moves. Custodian to custodian transfers have no tax reporting requirements so it is easier to get them done without risking a 1099-R screw up.
For the VG initiated IRA transfers, I did initiate these online but had to download, print and sign the paperwork (and get a medallion signature guarantee).
Stay hydrated; don't sweat the small stuff
Re: Any issues with rollovers from Fidelity to Vanguard?
Tim, sorry you ended up in a big mess, but the lesson here (for others) is never initiate more than one transfer at a time. Also, the transfers could be messed up at Vanguard as well. Easy to do with multiple transfers.
Paul
Technically, there is a difference between a rollover and a transfer (custodian to custodian transfer) which is what you should have requested. Should have been initiated by Vanguard, not Fidelity. Finally, why transfer from Fidelity to VG? You can get low cost index options at Fidelity, so maybe just change accounts, one at a time, and stay there.Initiated a rollover of my 3 separate employer 401K's with Fidelity over to Vanguard.
Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
- Earl Lemongrab
- Posts: 7270
- Joined: Tue Jun 10, 2014 1:14 am
Re: Any issues with rollovers from Fidelity to Vanguard?
Custodian transfers can only happen between like plans. From 401(k) to IRA is always going to be a rollover.pkcrafter wrote:Technically, there is a difference between a rollover and a transfer (custodian to custodian transfer) which is what you should have requested.
Many plans do not allow that.pkcrafter wrote:Should have been initiated by Vanguard, not Fidelity.
Re: Any issues with rollovers from Fidelity to Vanguard?
I'm not sure, Earl, this seems to say you can do a trustee to trustee transferEarl Lemongrab wrote:Custodian transfers can only happen between like plans. From 401(k) to IRA is always going to be a rollover.pkcrafter wrote:Technically, there is a difference between a rollover and a transfer (custodian to custodian transfer) which is what you should have requested.Many plans do not allow that.pkcrafter wrote:Should have been initiated by Vanguard, not Fidelity.
http://www.401khelpcenter.com/401k_educ ... overs.html
Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
- Earl Lemongrab
- Posts: 7270
- Joined: Tue Jun 10, 2014 1:14 am
Re: Any issues with rollovers from Fidelity to Vanguard?
That seemed pretty vague.pkcrafter wrote:I'm not sure, Earl, this seems to say you can do a trustee to trustee transfer
http://www.401khelpcenter.com/401k_educ ... overs.html
You can look at this IRS publication:
https://www.irs.gov/retirement-plans/pl ... tributions
The only mention of trustee transfer was for IRA->IRA. I did find something in Pub 575 about beneficiaries, but that's not relevant here.
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Re: Any issues with rollovers from Fidelity to Vanguard?
OP here. Thanks for all the feedback and yes, hindsight is 20/20. I should have checked in with the heads for advice before initiating the rollovers. Woulda, coulda, shoulda....
Comments:
Not looking for sympathy. I was just fuming that my only request from Fidelity over the past 27 years regarding my accounts was messed up. I wasn't sure if it was a common occurrence and wanted to ensure it was out there as a possible stumbling block during a rollover.
Fidelity rep was pleasant when discussing the procedure for conducting the rollovers. No issues there. It just didn't happen correctly.
Rollovers involve moving from one vehicle to a different vehicle (ex. 401K, 403b, etc. to IRA).
Transfers are between like accounts (ex. old employer 401k to new employer 401k, IRA from one custodian to IRA at a different custodian)
Decided on Vanguard because there is such a wealth of info on Vanguard options from contributors on forums like this.
Lessons learned:
One rollover between different custodians at a time so not out of the market almost entirely (401K to IRA).
Same thing with transfers (IRA to IRA).
When my wife leaves the workforce after 59 1/2 I will keep these things in mind when rolling over her accounts from American Funds/Lincoln to Vanguard.
Thanks again everyone. You rock!
Comments:
Not looking for sympathy. I was just fuming that my only request from Fidelity over the past 27 years regarding my accounts was messed up. I wasn't sure if it was a common occurrence and wanted to ensure it was out there as a possible stumbling block during a rollover.
Fidelity rep was pleasant when discussing the procedure for conducting the rollovers. No issues there. It just didn't happen correctly.
Rollovers involve moving from one vehicle to a different vehicle (ex. 401K, 403b, etc. to IRA).
Transfers are between like accounts (ex. old employer 401k to new employer 401k, IRA from one custodian to IRA at a different custodian)
Decided on Vanguard because there is such a wealth of info on Vanguard options from contributors on forums like this.
Lessons learned:
One rollover between different custodians at a time so not out of the market almost entirely (401K to IRA).
Same thing with transfers (IRA to IRA).
When my wife leaves the workforce after 59 1/2 I will keep these things in mind when rolling over her accounts from American Funds/Lincoln to Vanguard.
Thanks again everyone. You rock!
Re: Any issues with rollovers from Fidelity to Vanguard?
Earl, on the page you posted there is this:Earl Lemongrab wrote:That seemed pretty vague.pkcrafter wrote:I'm not sure, Earl, this seems to say you can do a trustee to trustee transfer
http://www.401khelpcenter.com/401k_educ ... overs.html
You can look at this IRS publication:
https://www.irs.gov/retirement-plans/pl ... tributions
The only mention of trustee transfer was for IRA->IRA. I did find something in Pub 575 about beneficiaries, but that's not relevant here.
How do I complete a rollover?
There is a possibility that a check might be issued, but it isn't mandatory, so a direct transfer seems to be possible.Direct rollover – If you’re getting a distribution from a retirement plan, you can ask your plan administrator to make the payment directly to another retirement plan or to an IRA. Contact your plan administrator for instructions. The administrator may issue your distribution in the form of a check made payable to your new account. No taxes will be withheld from your transfer amount.
Paul
When times are good, investors tend to forget about risk and focus on opportunity. When times are bad, investors tend to forget about opportunity and focus on risk.
Re: Any issues with rollovers from Fidelity to Vanguard?
^^ To me the big issue is when leaving a 401k (or 401a, 403b, 457b etc) are you forced to go to cash, or can you transfer in kind. I started a thread about this here.
viewtopic.php?f=10&t=214709
One suggestion seems to be to move to an IRA in the same company (then maybe later move out of that) as that seems a safer step, and more likely to use in-kind transfers.
viewtopic.php?f=10&t=214709
One suggestion seems to be to move to an IRA in the same company (then maybe later move out of that) as that seems a safer step, and more likely to use in-kind transfers.
- Earl Lemongrab
- Posts: 7270
- Joined: Tue Jun 10, 2014 1:14 am
Re: Any issues with rollovers from Fidelity to Vanguard?
Well, we're getting into some fine points. That's still a rollover, and will generate a 1099-R, unlike a custodian transfer. If the question is whether a direct rollover can take place without a check being issued and sent to the account holder, then certainly. I don't think that's a question, people do it all the time. I have myself, although going into the 401(k).pkcrafter wrote:There is a possibility that a check might be issued, but it isn't mandatory, so a direct transfer seems to be possible.