Moving money from one broker to the next

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JustWantToGetItRight
Posts: 138
Joined: Sat Aug 18, 2018 2:18 pm

Moving money from one broker to the next

Post by JustWantToGetItRight » Wed Aug 22, 2018 1:35 am

Currently at Schwab with most of my retirement assets in cash (i just fired money manger—who promised to beat the market and didn't—and so I liquidated all the investments---tired of his high fees and no returns and I am tired of all the noise. I am ready to go the low cost index route with Vanguard and just hold for the long term.

But It costs money to do close accounts and transfer funds from Schwab to Vanguard? And it is a total hassle when dealing with things like my Roth IRA. Thus....I was thinking of:

1) Keeping my emergency fund (earning 1.5%) at Schwab

2) Keeping my Roth IRA in a low cost ETF heavily invested in stocks for growth (and benefiting from the tax advantages) at Schwab
-------

3) Moving the rest of the money over to Vanguard in a taxable account like the Target Dated 2030 (so it automatically rebalances) and maybe one other fund....

or should I just move everything?

Thanks for the help.....

Jablean
Posts: 250
Joined: Sat Jun 02, 2018 2:38 pm

Re: MOVING MONEY FROM ONE BROKER TO THE NEXT

Post by Jablean » Wed Aug 22, 2018 1:52 am

Need your age and a bit more info on how much is allocated . Check the wiki for best presentation format.

You say you want to keep your Roth in stocks - recommendation around here is more to keep the bond(ish) portion in tax advantaged and stock in taxable but the percentage of each is based on age and retirement expectations.

For most people it's easier to have everything in one place but if you are into making snap decisions you might want to wait until you've decided on your desired allocations.

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celia
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Location: SoCal

Re: MOVING MONEY FROM ONE BROKER TO THE NEXT

Post by celia » Wed Aug 22, 2018 2:27 am

JustWantToGetItRight wrote:
Wed Aug 22, 2018 1:35 am
But It costs money to do close accounts and transfer funds from Schwab to Vanguard?
The only costs are:
* the cost of postage to mail in forms to the new custodian and let them pull the funds over for you.
* a possible account closing fee from the old custodian (per account)
* taxes that will be due on the gains (if any) in your taxable account when you file your 2018 return. Before you close out the taxable account, I suggest you find out what your cost basis was for each holding in taxable, since it will be needed for your tax return. After you close the account, it might be harder to get it from the old custodian.
And it is a total hassle when dealing with things like my Roth IRA.
It depends on what you mean by "hassle". Again, send in the appropriate forms to Vanguard and let them move the assets for you.

Your first step is to call Vanguard and they will email the appropriate forms to you, if you ask.

AlohaJoe
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Re: MOVING MONEY FROM ONE BROKER TO THE NEXT

Post by AlohaJoe » Wed Aug 22, 2018 2:33 am

JustWantToGetItRight wrote:
Wed Aug 22, 2018 1:35 am
Currently at Schwab
So why don't you just use Schwab's perfectly good funds? Lots of people on this forum do that. Schwab has target date funds, index funds, and everything else you need. Anything they don't have can be bought as an ETF.

Moving to Vanguard makes no sense to me.

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darkhorse346
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Re: MOVING MONEY FROM ONE BROKER TO THE NEXT

Post by darkhorse346 » Wed Aug 22, 2018 4:12 am

AlohaJoe wrote:
Wed Aug 22, 2018 2:33 am
JustWantToGetItRight wrote:
Wed Aug 22, 2018 1:35 am
Currently at Schwab
So why don't you just use Schwab's perfectly good funds? Lots of people on this forum do that. Schwab has target date funds, index funds, and everything else you need. Anything they don't have can be bought as an ETF.

Moving to Vanguard makes no sense to me.
I somewhat agree with AlohaJoe.

What are you really gaining by switching? My experience is that the grass is not always greener. There are tradeoffs...

If you've not already done so, I suggest you peruse this site on the pros/cons of Vanguard, Schwab, Fidelity, etc. You may want to sit tight at Schwab for the next couple of months and really research this. Test drive the sites, etc.

If, after all is said and done, you still want to switch, I'd gradually transfer an account or two from Schwab to Vanguard at a time. I do not recommend transferring all at one time. I would not let the Schwab closing fee be the deciding factor on whether to switch or not.

Good luck.

student
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Re: Moving money from one broker to the next

Post by student » Wed Aug 22, 2018 5:30 am

You can accomplish, for example, a 3-fund portfolio at Schwab as well and they have 24-hour customer service. If you want a target index fund such as 2030, Schwab has it too. https://www.schwab.com/public/schwab/in ... ol%3dSWYEX

bondsr4me
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Re: Moving money from one broker to the next

Post by bondsr4me » Wed Aug 22, 2018 6:00 am

Whether you move to Vanguard from Schwab is up to you.

I just this month moved my entire IRA and my wife’s entire IRA from Schwab to Vanguard.

I did a Full ACAT at Vanguard; they took care of the rest; no paperwork; 100% online.

Yes, initially Schwab charged each of us a $50 transfer out fee.

I promptly objected using their email system.

They FULLY refunded to us each of the $50 fees.

I also FULLY transferred our Joint brokerage account from Schwab to Fidelity.
Again, they hit us with the $50 transfer out fee.
Again, I promptly objected.
Again, they refunded the $50 to our account.

If you want to transfer to VG (or Fido), then transfer.
If Schwab hits you with a fee, object to it. They have a Satisfaction guarantee.

I now have one less broker to deal with.

Have a great week,

Don

Nate79
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Location: Delaware

Re: Moving money from one broker to the next

Post by Nate79 » Wed Aug 22, 2018 11:24 am

I would stick with Scwab. Much better broker to deal with, lower costs, and better service.

JustWantToGetItRight
Posts: 138
Joined: Sat Aug 18, 2018 2:18 pm

Re: MOVING MONEY FROM ONE BROKER TO THE NEXT

Post by JustWantToGetItRight » Wed Aug 22, 2018 11:29 am

Jablean wrote:
Wed Aug 22, 2018 1:52 am
Need your age and a bit more info on how much is allocated . Check the wiki for best presentation format.

Here is more info:

53 Years Old
Unmarried
No Kids
Rent
No Debt
Excellent Credit
Retirement Goal: 65 (12 Years...)
How Much: $800,000 - 1,000,000
Big Ticket Items: Retirement Only
Current Total Asets: $450,000

ACCOUNTS:
1. Managed Account (Through 3rd Party, Held at Schwab)
Schwab Taxable Account: Stocks 40%, stocks, 55%, cash 5%. Total Assets: 342,000K
Schwab Roth 75% stocks, 20% bonds 5% cash: Total Assets: 28k
Schwab Money Market: Emergency Fund 35K

2. 401 K at work
Vanguard 2030 Target Fund" 70% stocks, 30 Bonds: Total Assets 53 K
Fidelity S&P 500 Index: 100% Stocks: 8K

Again, just fired my money manager. Spend 4K in one year, got no one returns, and relationship was kind of weird. He got made when I asked questions and said he didn't have time to educate me.

In any case, money is all at Scwab in the securities that the guy bought. I am thinking of liquidated and just using low cost index funds (like Target Funds that rebalance as I get older. BUT, I have no idea whether to say at Schwab or go to Vanguard.

I like Schwab 24/7 customer service, even though they can't really give any advice. I've considered the Intelligent portfolio or advisor, but I don't know if I want to pay .28 or .30 (at Vanguard) nor know if I need too (my life is pretty simple and I just want to do something where I can set it and forget it---or at the most, check it once a year.

Thoughts?

JustWantToGetItRight
Posts: 138
Joined: Sat Aug 18, 2018 2:18 pm

Re: Moving money from one broker to the next

Post by JustWantToGetItRight » Wed Aug 22, 2018 11:34 am

Nate79 wrote:
Wed Aug 22, 2018 11:24 am
I would stick with Scwab. Much better broker to deal with, lower costs, and better service.
The Scwab Target 2030 SWYEX did have a .08 Expense ration compared to VTTHRX (investor Shares) of .14 or the VTTWX .9 which was surprising.....

Jablean
Posts: 250
Joined: Sat Jun 02, 2018 2:38 pm

Re: MOVING MONEY FROM ONE BROKER TO THE NEXT

Post by Jablean » Wed Aug 22, 2018 11:55 pm

JustWantToGetItRight wrote:
Wed Aug 22, 2018 11:29 am
Jablean wrote:
Wed Aug 22, 2018 1:52 am
Need your age and a bit more info on how much is allocated . Check the wiki for best presentation format.

Here is more info:

53 Years Old
Unmarried
No Kids
Rent
No Debt
Excellent Credit
Retirement Goal: 65 (12 Years...)
How Much: $800,000 - 1,000,000
Big Ticket Items: Retirement Only
Current Total Asets: $450,000

ACCOUNTS:
1. Managed Account (Through 3rd Party, Held at Schwab)
Schwab Taxable Account: Stocks 40%, stocks, 55%, cash 5%. Total Assets: 342,000K
Schwab Roth 75% stocks, 20% bonds 5% cash: Total Assets: 28k
Schwab Money Market: Emergency Fund 35K

2. 401 K at work
Vanguard 2030 Target Fund" 70% stocks, 30 Bonds: Total Assets 53 K
Fidelity S&P 500 Index: 100% Stocks: 8K

Again, just fired my money manager. Spend 4K in one year, got no one returns, and relationship was kind of weird. He got made when I asked questions and said he didn't have time to educate me.

In any case, money is all at Scwab in the securities that the guy bought. I am thinking of liquidated and just using low cost index funds (like Target Funds that rebalance as I get older. BUT, I have no idea whether to say at Schwab or go to Vanguard.

I like Schwab 24/7 customer service, even though they can't really give any advice. I've considered the Intelligent portfolio or advisor, but I don't know if I want to pay .28 or .30 (at Vanguard) nor know if I need too (my life is pretty simple and I just want to do something where I can set it and forget it---or at the most, check it once a year.

Thoughts?
Ok, you've got a big percentage in taxable and that may to cost you significant capgains if you liquidate. This will probably lead to staying with Schwab for the next year and making plans to move them and not throwing the baby out with the bath water. To get more help from people here it would be best to edit your original post (next to it you'll see a pencil icon which will allow you to edit). Put the things you've put here but also flesh out the exact funds that your taxable is in as I think that is where you need help.

JustWantToGetItRight
Posts: 138
Joined: Sat Aug 18, 2018 2:18 pm

Re: MOVING MONEY FROM ONE BROKER TO THE NEXT

Post by JustWantToGetItRight » Thu Aug 23, 2018 12:24 am

Jablean wrote:
Wed Aug 22, 2018 11:55 pm
JustWantToGetItRight wrote:
Wed Aug 22, 2018 11:29 am
Jablean wrote:
Wed Aug 22, 2018 1:52 am
Need your age and a bit more info on how much is allocated . Check the wiki for best presentation format.

Here is more info:

53 Years Old
Unmarried
No Kids
Rent
No Debt
Excellent Credit
Retirement Goal: 65 (12 Years...)
How Much: $800,000 - 1,000,000
Big Ticket Items: Retirement Only
Current Total Asets: $450,000

ACCOUNTS:
1. Managed Account (Through 3rd Party, Held at Schwab)
Schwab Taxable Account: Stocks 40%, stocks, 55%, cash 5%. Total Assets: 342,000K
Schwab Roth 75% stocks, 20% bonds 5% cash: Total Assets: 28k
Schwab Money Market: Emergency Fund 35K

2. 401 K at work
Vanguard 2030 Target Fund" 70% stocks, 30 Bonds: Total Assets 53 K
Fidelity S&P 500 Index: 100% Stocks: 8K

Again, just fired my money manager. Spend 4K in one year, got no one returns, and relationship was kind of weird. He got made when I asked questions and said he didn't have time to educate me.

In any case, money is all at Scwab in the securities that the guy bought. I am thinking of liquidated and just using low cost index funds (like Target Funds that rebalance as I get older. BUT, I have no idea whether to say at Schwab or go to Vanguard.

I like Schwab 24/7 customer service, even though they can't really give any advice. I've considered the Intelligent portfolio or advisor, but I don't know if I want to pay .28 or .30 (at Vanguard) nor know if I need too (my life is pretty simple and I just want to do something where I can set it and forget it---or at the most, check it once a year.

Thoughts?
Ok, you've got a big percentage in taxable and that may to cost you significant capgains if you liquidate. This will probably lead to staying with Schwab for the next year and making plans to move them and not throwing the baby out with the bath water. To get more help from people here it would be best to edit your original post (next to it you'll see a pencil icon which will allow you to edit). Put the things you've put here but also flesh out the exact funds that your taxable is in as I think that is where you need help.
Thank you Jablean. The reason why I have a bigger percentage of money in a taxable account is because I got a huge lump sum of inheritance money at one time. I couldn't put it in my 401K at work obviously at can only put so much in my Roth.
What else could I have done? Also, the capital gains are not the much---only $250 (the money manager made me NO money---the account was flat all year---even at the end of 2017 when things were more bullish).

I am so confused. I don't know whether to just stay at Schwab and do Target Dated Funds with part of the funds and do the Intelligent Advisory or Portfolio with the other portion, or to move everything over the Vanguard. In the latter case, This will be the third move in three years. Maybe I am the problem (LOL). I need to just set something up and let it sit---definitely I am more hands off but do not want to pay a lot of fees wither.

PS: Sorry about my posts. I am trying to figure this blog out still.

Jablean
Posts: 250
Joined: Sat Jun 02, 2018 2:38 pm

Re: Moving money from one broker to the next

Post by Jablean » Thu Aug 23, 2018 12:44 am

No problem and I think that talking it through is helping you. So now let's see where you actually are and to do that you need to get out your last statement and list the funds you are in (by symbol and name) along with percentage of the total or even easier by actual dollars. As people have said there's nothing wrong with Schwab, they have good funds with just as low rates as the others we just need to get you allocated in something that fits your investment personality. If you'd care to answer, why did you move it the first time? I just inherited funds from my mother so I've been moving things around too.

JustWantToGetItRight
Posts: 138
Joined: Sat Aug 18, 2018 2:18 pm

Re: Moving money from one broker to the next

Post by JustWantToGetItRight » Thu Aug 23, 2018 5:11 am

To Jablean ...

Thanks for your help. The money in my larger taxable account and ROTH account is all going to be liquidated. But it includes:

Taxable Account: The taxable account had things like (1) 21 40% of common stock picks like Eagle Mines, Alphabet inc, Anheuser Busch, Bayer, Berkshire Hathaway, Disney, and......General Electric! (2) 50% Corporate bonds like Western Union, Gernal Motors, and Walgreens; (3) 5% Income assets like flex shares Iboxx and Vanguard Short Term Bonds ETF, and (4) 5% Cash in a Money Fund. Total: 340,000

Roth Account: The Roth account had things like (1) 80% Common stock including the same as above (Eagle Mines, Alphabet inc), (2) 10 % closed end funds like Wisdom Tree Emerging Markets, and (3) cash. Total: 28,200.

--------------

My Problem:
Merril Lynch: Merril Lych guys were nice and had good customer service and platform, but the guy was dealing with at B of A never seemed to have answers to my questions: I had the money split between a robot account, a manger account, and a 2030 Target Fund. The 2030 out performed the other two by 15K in the year. The other accounts were essentially flat. So I moved to a money manger I met at UCLA class on personal finance.

The Money Manager firm: They cost me 5K in fees this year and made me 2K. They got impatient with my questions like: Guys, why are you holding large chunks of cash in a non-interest bearing account, why is my 401K with a .18 expense Ratio beating your fund, and how do you guys keep track of each of your clients' personal goals and mange their accounts approproately---(I asked him this because I had to remind him to move cash from my taxable account to my Roth each year). In any case, that relationship is over.

Now What''s The Next Move: Here are the things I know about myself: I am realizing that I am too emotional with all of this: I am scared of making the wrong decision and missing out---not getting good returns, realizing I paid too much in taxes, paying for fees that I could have avoided. I am also too busy to be worry about this stuff all of the time---I have sleepless nights thinking about it, so I probably just want to set something and forget it. I am leaning toward Target Dated Funds and/or the Schwab Intelligent Portfolio or Advisory (or the Vanguard Version---but that would mean transferring funds).

So what do I do?

afan
Posts: 3925
Joined: Sun Jul 25, 2010 4:01 pm

Re: Moving money from one broker to the next

Post by afan » Thu Aug 23, 2018 6:18 am

It seems the OP is assuming that ending the relationship with the former investment manager requires liquidating the assets and leaving Schwab.

The rest of us are assuming neither of those moves are necessary. The OP can simply stop using the manager, leave the money at Schwab and make independent decisions about what assets to keep or to liquidate.

I am all for index funds but not for paying taxes. To the extent that these individual stocks have tax losses or minimal gains, I would agree to get rid of them. For any gains I would consider holding on long enough to have them treated as long term gains.

Between Vanguard and Schwab: I have been a happy Vanguard customer for a long time. I am a pure DIY investor and all I want from any firm is doing what they are told and not bothering me otherwise. Vanguard does this. Schwab, I am sure, would do the same. Schwab will also offer more handholding, which some people appreciate. They give you this handholding at no additional cost, so if you want it you get it for free.

One can do an all index portfolio with dirt cheap funds at either company. Both offer such mutual funds at no transaction fees and simple index ETFs with no commissions.

So you have 3 independent decisions
1 keep or dump your advisor. Given what your portfolio held, I would definitely drop the advisor.

2. Hold the portfolio as is or sell much of it and put the money in index funds. The latter is probably a good idea but look at the tax consequences.

3. Stay at Schwab or move to Vanguard. There are no financial implications but the companies are somewhat different in culture. OP has to decide which firm is a better fit.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

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