Help Transfer Index Fund from Fidelity To Vanguard

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Polenta
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Help Transfer Index Fund from Fidelity To Vanguard

Post by Polenta » Sat Apr 07, 2018 9:12 pm

Hello

I am trying to consolidate accounts. I own Fidelity Total Stock Market Index in a taxable account and would like to move it to Vanguard Total stock market index. These are identical funds more or less. Is there anyway I can achieve this transfer without having to pay capital gains on the Fidelity account? I get a feeling the answer is no but any suggestions would be helpful

Thanks
Polenta

radiowave
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by radiowave » Sat Apr 07, 2018 9:51 pm

Sorry to disappoint, but you'll have to sell the funds (FSTVX?) for the equivalent VG VTSAX and that will trigger capital gains. You may be able to hold Fidelity in VG however my impression is you want to go all Vanguard funds.
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danaht
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by danaht » Sat Apr 07, 2018 10:00 pm

radiowave wrote:
Sat Apr 07, 2018 9:51 pm
Sorry to disappoint, but you'll have to sell the funds (FSTVX?) for the equivalent VG VTSAX and that will trigger capital gains. You may be able to hold Fidelity in VG however my impression is you want to go all Vanguard funds.
That's why I no longer buy non-Vanguard mutual funds in taxable accounts. I generally only buy ETFs now - because they can easily be transferred. I guess one exception to this are some of the mutual funds from Vanguard that can be easily be converted to a ETF without any tax consequences.

radiowave
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by radiowave » Sat Apr 07, 2018 10:08 pm

danaht wrote:
Sat Apr 07, 2018 10:00 pm
radiowave wrote:
Sat Apr 07, 2018 9:51 pm
Sorry to disappoint, but you'll have to sell the funds (FSTVX?) for the equivalent VG VTSAX and that will trigger capital gains. You may be able to hold Fidelity in VG however my impression is you want to go all Vanguard funds.
That's why I no longer buy non-Vanguard mutual funds in taxable accounts. I generally only buy ETFs now - because they can easily be transferred. I guess one exception to this are some of the mutual funds from Vanguard that can be easily be converted to a ETF without any tax consequences.
Yes, e.g. you can go from VTSAX (VG Total Stock) mutual fund to VTI (the ETF equivalent) without capital gains. Unfortunately you can't go from the ETF back to the mutual fund without selling then repurchasing the mutual fund and incurring CG.
Bogleheads Wiki: https://www.bogleheads.org/wiki/Main_Page

Polenta
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by Polenta » Sat Apr 07, 2018 11:34 pm

Radiowave

Could you explain how I can go about holding the Fidelity Fund in Vanguard as you mention?

TropikThunder
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by TropikThunder » Sat Apr 07, 2018 11:48 pm

Polenta wrote:
Sat Apr 07, 2018 11:34 pm
Radiowave

Could you explain how I can go about holding the Fidelity Fund in Vanguard as you mention?
In many (most?) cases, you can hold Fund Family A's shares at Fund Family B's brokerage*. You may have to pay a commission to trade the "off-brand" fund, but you can do so. In this case, you can trade shares of FSTVX (if that's the fund in question) at Vanguard but you'll incur a $50 transaction fee. If your goal is to just consolidate accounts (i.e., move the Fidelity mutual funds to Vanguard using an in-kind transfer) and you don't feel the need to convert from the Fidelity mutual fund to the Vanguard mutual fund, this may be an acceptable arrangement for you. If your goal is to convert the Fidelity funds at Fidelity to Vanguard funds at Vanguard, then you'll have to sell one and buy the other and accept the capital gains. If the Fidelity fund tracks the same or similar index and has comparable cost as the Vanguard one, you'll probably be fine not converting.
https://investor.vanguard.com/other-funds/

*Some mutual funds are proprietary, and can only be held at the brokerage that issues them.

TwstdSista
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by TwstdSista » Sun Apr 08, 2018 9:12 am

If you are holding the Investor Class (FSTMX), I believe you can hold that at Vanguard. But my understanding is that Fidelity will not allow you to hold their Premium Class fund (FSTVX) at another brokerage. And I do not believe that they will allow you to go "backwards" (ie, from premium class down to investor class).

pkcrafter
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by pkcrafter » Sun Apr 08, 2018 9:46 am

Polenta, if you hold FSTVX or FSTMX it appears Vanguard carries both, so you can do a transfer "in kind" and simply continue to hold your fund. There is something to say for consolidation and simplicity, but I would suggest you just continue to hold the fund at Fidelity.

Paul
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dbr
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by dbr » Sun Apr 08, 2018 9:52 am

There is also an argument to keep two sources of holdings just in case some glitch happens at one or the other that would result in a period of no access to funds. It may be each vendor offers some convenience features not available at the other as well. In reality it is difficult to completely consolidate one's financial life and probably not worth trying.

Polenta
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by Polenta » Sun Apr 08, 2018 12:42 pm

I appreciate all your comments. Thank You . I think I will initiate a transfer in kind as suggested. I guess I can do it on line but not sure exactly what form to use but I will figure that out. If anyone with experience can briefly guide me through the procedure it would be appreciated.

Again , thanks

Polenta

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Duckie
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by Duckie » Sun Apr 08, 2018 6:04 pm

Polenta wrote:I think I will initiate a transfer in kind as suggested. I guess I can do it on line but not sure exactly what form to use but I will figure that out. If anyone with experience can briefly guide me through the procedure it would be appreciated.
You need to open a taxable brokerage account at Vanguard. It's called an "Individual account". Once opened you get Vanguard to pull the Fidelity fund "in kind". Here's the Open a new account page. I'm not sure if you want to start with the red button or the blue section.

Also take a look at:
How to transfer money to Vanguard
Answers to common account transfer questions.

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ruralavalon
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by ruralavalon » Mon Apr 09, 2018 9:19 am

Polenta wrote:
Sat Apr 07, 2018 11:34 pm
Radiowave

Could you explain how I can go about holding the Fidelity Fund in Vanguard as you mention?
Call Vanguard and ask if you can hold the Fidelity fund in a Vanguard account, I think you can do this.

Transfer the shares of the Fidelity fund to Vanguard "in kind".

Don't set up automatic reinvestment of the dividends and gains of the Fidelity fund, instead use the proceeds to buy shares of the Vanguard fund you want.
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

Nate79
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by Nate79 » Mon Apr 09, 2018 12:00 pm

Why do you want to transfer out of Fidelity?

Polenta
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Re: Help Transfer Index Fund from Fidelity To Vanguard

Post by Polenta » Mon Apr 09, 2018 7:19 pm

I want to transfer out of Fidelity because I am trying to consolidate accounts. I have more money with Vanguard and have moved other holdings from other sources over to Vanguard as well. Having all your accounts under one roof makes sense to me. Nothing against Fidelity .
I was on the phone today with Vanguard and Fidelity about this "in kind" transfer and I was able to get the paperwork in the mail today to get this transfer done. Both companies were quick to answer the phone today and both customer service reps were very knowledgeable in their guidance. Paperwork was sent to me quickly online. I have never had an issue with either Vanguard or Fidelity when it comes to customer service. I was pleased. My taxable money stays with Fidelity but will be accounted for under Vanguard's brokerage.
I am also moving two frozen 403b accounts from Fidelity over to a Vanguard Traditional IRA since I am retired recently. This move will be a little more complicated because Fidelity wants a signature guarantee in order to facilitate this 403b transfer/sale. Thanks again for all your comments. You helped me get it done.

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