Where to transfer Roth?

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valleyman123
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Where to transfer Roth?

Post by valleyman123 » Fri May 25, 2018 3:45 pm

Simple question for most of you. I have $9000 in a ROTH in fund HCTAX that has very high fees. After reading here a little I want to move it to Schwab or Vanguard. My current employers 401k is a target fund for 2055 through T Rowe price. What fund would you pick at schwab or vanguard for my ROTH transfer. These are my only investments and I am 29 years old. Thanks.

retiredjg
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Re: Where to transfer ROTH?

Post by retiredjg » Fri May 25, 2018 4:32 pm

Both Vanguard and Schwab have good target funds. And Fidelity.

Wherever you go, be sure you buy an index target fund, not an actively managed target fund. The word "index" should be in the name.

retiredjg
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Re: Where to transfer ROTH?

Post by retiredjg » Fri May 25, 2018 4:33 pm

All other things being equal, I would choose Vanguard or Fidelity over Schwab because Schwab tends to keep a portion of the fund in cash rather than stocks and bonds.

DippityDoo
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Re: Where to transfer ROTH?

Post by DippityDoo » Fri May 25, 2018 5:13 pm

retiredjg wrote:
Fri May 25, 2018 4:33 pm
All other things being equal, I would choose Vanguard or Fidelity over Schwab because Schwab tends to keep a portion of the fund in cash rather than stocks and bonds.
The OP is young enough that a Fidelity Freedom Index Fund appropriate for him likely wouldn't hold cash until he's much further along the glide path. But that group of funds does invest in cash closer to retirement. For example FQIFX* has 5.9% in money market and FPIFX** has 9.36% in money market. Last time I checked, Vanguard's TD index funds for the same dates did not hold cash. You raise an excellent point that cash allocation is something to consider.


*FQIFX Fidelity Freedom Index 2025 Fund
**FPIFX Fidelity Freedom Index 2020 Fund

valleyman123
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Re: Where to transfer ROTH?

Post by valleyman123 » Fri May 25, 2018 7:54 pm

What if I were to pick vanguard funds through schwab. I hear schwab customer service and other services are much better.

DippityDoo
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Re: Where to transfer ROTH?

Post by DippityDoo » Fri May 25, 2018 8:06 pm

valleyman123 wrote:
Fri May 25, 2018 7:54 pm
What if I were to pick vanguard funds through schwab. I hear schwab customer service and other services are much better.
You can do that, although you'll pay a fee for purchase/sale of the fund unless you can negotiate some free trades. I hold a Vanguard fund at Fidelity. There is no fee to auto-reinvest the annual dividend. I'm pretty sure Schwab allows free dividend reinvestment too, but please make sure you check on that.

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Alexa9
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Re: Where to transfer ROTH?

Post by Alexa9 » Fri May 25, 2018 8:40 pm

valleyman123 wrote:
Fri May 25, 2018 7:54 pm
What if I were to pick vanguard funds through schwab. I hear schwab customer service and other services are much better.
Admiral shares are only at Vanguard. You could use ETF's for the same expense ratio as Admiral Shares though.

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LadyGeek
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Re: Where to transfer Roth?

Post by LadyGeek » Fri May 25, 2018 8:58 pm

valleyman123, Welcome!

FYI - A Roth IRA gets its name from US Senator William Roth - it's not an acronym. I changed the thread title.
Named after US Senator William Roth, Roth IRAs were established by the Taxpayer Relief Act of 1997.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

retiredjg
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Re: Where to transfer ROTH?

Post by retiredjg » Sat May 26, 2018 6:02 am

valleyman123 wrote:
Fri May 25, 2018 7:54 pm
What if I were to pick vanguard funds through schwab. I hear schwab customer service and other services are much better.
If you want Vanguard funds, you should use Vanguard. This avoids transaction fees and gives you access to the lower cost Admiral shares.

If you want to use Schwab, they have a nice lists of ETFs on their no-transaction list. They also have an adequate but limited list of Schwab index mutual funds you could use.

Fidelity has a good no-transaction fee list of both index mutual funds and ETFs.

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