[Switching from Target Date fund to 3-fund portfolio - How?]

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Road2Freedom
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[Switching from Target Date fund to 3-fund portfolio - How?]

Post by Road2Freedom » Sun Nov 19, 2017 5:50 pm

[Moved into a stand-alone post from: The Three-Fund Portfolio --admin LadyGeek]

I currently have Fidelity Target Date Funds for my Rollover IRA, Roth IRA, and wife's Rollover and and read the initial post regarding the recommended 3-fund portfolio with Fidelity. I plan on calling Fidelity tomorrow to switch from the Target Date Fund to an 80/20 mix. Will they execute the trade over the phone for me or do I need to do it online? I thought it would be easier for me to call them and request 64% to Total Stock, 16% to Total International, and 20% to Total Bond.

I can do Premium Class for my Rollover but will likely have to do Investor Class for some of the Roth IRA and wife's Rollover due to the $10K min.

Sorry for the noob question, but this is all really new to me.

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CABob
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by CABob » Sun Nov 19, 2017 11:42 pm

I can't speak for Fido since I do not have an account with them, but at Vanguard it would be very easy online transactions. I would expect that Fido would be similar.
At VG you would go to your Target Date fund online and make three exchanges from that fund into the three funds specifying the amount of each exchange.
Bob

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busdriver
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by busdriver » Sun Nov 19, 2017 11:55 pm

I have the majority of my investments at Fidelity all of which is now in the three fund portfolio. I believe if you call and have a Fidelity representative place your orders, there will be a charge; whereas, if you do the sell and subsequent buy orders yourself online, there will be no charge. At least that’s what I recall from a previous phone conversation several years back. You can call Fidelity and speak with a representative to see if this still is the case. I really don’t like Fidelity’s Target Funds mainly due to their high percentage of cash funds and fees compared to Vanguard’s Target Funds.

PFInterest
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by PFInterest » Mon Nov 20, 2017 12:02 am

If you don't know how to execute this, maybe you should sit tight for now.

Road2Freedom
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by Road2Freedom » Mon Nov 20, 2017 7:30 am

CABob wrote:
Sun Nov 19, 2017 11:42 pm
I can't speak for Fido since I do not have an account with them, but at Vanguard it would be very easy online transactions. I would expect that Fido would be similar.
At VG you would go to your Target Date fund online and make three exchanges from that fund into the three funds specifying the amount of each exchange.
Appreciate the info and will take a look this morning.
busdriver wrote:
Sun Nov 19, 2017 11:55 pm
I have the majority of my investments at Fidelity all of which is now in the three fund portfolio. I believe if you call and have a Fidelity representative place your orders, there will be a charge; whereas, if you do the sell and subsequent buy orders yourself online, there will be no charge. At least that’s what I recall from a previous phone conversation several years back. You can call Fidelity and speak with a representative to see if this still is the case. I really don’t like Fidelity’s Target Funds mainly due to their high percentage of cash funds and fees compared to Vanguard’s Target Funds.
Thanks! Agree with Fidelity's Target Funds and their expense ratios. Wish I would've looked into this several years ago. Suppose better late than never.

Road2Freedom
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by Road2Freedom » Mon Nov 20, 2017 10:43 am

I called this morning and they walked me through the first trade. Was pretty easy after that, with the exception of having to make the final trade in shares versus dollar amount for each account.

Again, thanks for the replies.

spammagnet
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by spammagnet » Tue Nov 21, 2017 12:14 am

With respect to your use of Investor class rather than Premium class, is that because the total in some accounts is less than $10K? Or because you're trying to implement a three-fund portfolio separately in each account?

If the latter, you don't need to do that. You allocation should be applied across all accounts, in aggregate. That may allow you to distribute your purchases in a way that meets the minimum for all funds, in each account.

Consider making your Roth 100% stock, assuming your allocation results in having that much invested in stock.

mav12
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by mav12 » Tue Nov 21, 2017 1:39 am

busdriver wrote:
Sun Nov 19, 2017 11:55 pm
I have the majority of my investments at Fidelity all of which is now in the three fund portfolio. I believe if you call and have a Fidelity representative place your orders, there will be a charge; whereas, if you do the sell and subsequent buy orders yourself online, there will be no charge. At least that’s what I recall from a previous phone conversation several years back. You can call Fidelity and speak with a representative to see if this still is the case. I really don’t like Fidelity’s Target Funds mainly due to their high percentage of cash funds and fees compared to Vanguard’s Target Funds.
I have a part of my portfolio at Fid. How is the performance of your 3 funds, especially these past 2 weeks and in 2015 when the market was flat? I wish there was a tool that could show me a historical performance of a basket (3 funds) of securities.

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busdriver
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by busdriver » Tue Nov 21, 2017 6:15 am

mav12 wrote:
Tue Nov 21, 2017 1:39 am
busdriver wrote:
Sun Nov 19, 2017 11:55 pm
I have the majority of my investments at Fidelity all of which is now in the three fund portfolio. I believe if you call and have a Fidelity representative place your orders, there will be a charge; whereas, if you do the sell and subsequent buy orders yourself online, there will be no charge. At least that’s what I recall from a previous phone conversation several years back. You can call Fidelity and speak with a representative to see if this still is the case. I really don’t like Fidelity’s Target Funds mainly due to their high percentage of cash funds and fees compared to Vanguard’s Target Funds.
I have a part of my portfolio at Fid. How is the performance of your 3 funds, especially these past 2 weeks and in 2015 when the market was flat? I wish there was a tool that could show me a historical performance of a basket (3 funds) of securities.
I honestly don't pay attention to a 2 week period. When the market was flat, so was my portfolio. Rather than chase the hot fund of the year, (which may be next year's dog), I accept what the market returns are knowing I didn't do any worse. Prior to the three-fund, I did good, but never consistently kept up with the market. If it helps, my one year return as of 10-31-17 was 14.17% for a 60/40 stocks/bonds ratio with 40 us/20 intl.

Road2Freedom
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Re: [Switching from Target Date fund to 3-fund portfolio - How?]

Post by Road2Freedom » Tue Nov 21, 2017 8:34 am

spammagnet wrote:
Tue Nov 21, 2017 12:14 am
With respect to your use of Investor class rather than Premium class, is that because the total in some accounts is less than $10K? Or because you're trying to implement a three-fund portfolio separately in each account?

If the latter, you don't need to do that. You allocation should be applied across all accounts, in aggregate. That may allow you to distribute your purchases in a way that meets the minimum for all funds, in each account.

Consider making your Roth 100% stock, assuming your allocation results in having that much invested in stock.
It was because I was making each account a 3-fund portfolio. I never thought of doing it that way. I ended up with Investor class for International in the smaller Rollover and Roth.

I appreciate the insight.

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