Move some over to Fidelity ZERO ?

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NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 9:39 am

Hello all,
Was just debating whether to move the Vanguard Total International portion of my 403B (about 80k) over to a rollover IRA in the new Fidelity Zero international.
I don’t think I’d mind losing the small caps, but of course it’s the expense ratio that catches my attention (.11 to 0). I’m figuring if I want to add international I can always open a Roth at Fidelity in the same fund.

Any thoughts? Still wait ?
Thanks for all the advice you give ....

retiredjg
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Re: Move some over to Fidelity ZERO ?

Post by retiredjg » Sat Aug 25, 2018 10:08 am

Getting something for free, especially when it is not spendy to begin with, doesn't make much sense if it affects other things in your portfolio negatively. Or makes things more complicated. Or does not serve your purposes in some way.

If you have $80k in the fund the difference in cost is $88 a year. Is having another account at another brokerage worth that to you? What happens to your 403b if you take the international out? Will you have a way to add money to the rollover IRA? If now, how will you keep your international allocation up to target?

The overall picture is what counts and what a change is worth to you. It should not be about getting something for free, especially if you are giving something up to get it.

2cents2
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Re: Move some over to Fidelity ZERO ?

Post by 2cents2 » Sat Aug 25, 2018 10:11 am

If it fits in with your overall plan.
Your 403B rollover to a tIRA will complicate things if you plan to do non deductible contribution(s) to a tIRA followed by a conversion(s) to a Roth in the future.

I converted DH's international to FZILX (once I got over my initial shock and skepticism :happy :) ), but he was already at Fidelity.

workerbeeengineer
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Re: Move some over to Fidelity ZERO ?

Post by workerbeeengineer » Sat Aug 25, 2018 10:11 am

Zero ER is good, but you seem to acknowledge that you will need to either give up international small cap exposure or actually have to open two accounts at Fidelity. Only you can decide if the reduction in cost from the 0.11% ER going away justifies the added complexity. I'm sure lots of opinions are available here. :happy

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Leif
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Re: Move some over to Fidelity ZERO ?

Post by Leif » Sat Aug 25, 2018 10:33 am

I would not want to lose international small caps exposure in a tax deferred account. Small caps give you the best international diversification since it is not as closely tied to want is happening in the US.

Taxable account is another story. I'm thinking about the international zero in the taxable account. But, I'll wait a few years to see the funds results and tax efficiency.

rgs92
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Joined: Mon Mar 02, 2009 8:00 pm

Re: Move some over to Fidelity ZERO ?

Post by rgs92 » Sat Aug 25, 2018 11:00 am

I still stick with Vanguard Balanced Index and the Fidelity Freedom Index funds because I like the idea of continuous re-balancing, hoping it will smooth out the ride. (Of course, hope is not a strategy, but I do it anyway, like it's a lucky charm in my pocket.)

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 3:36 pm

retiredjg wrote:
Sat Aug 25, 2018 10:08 am
Getting something for free, especially when it is not spendy to begin with, doesn't make much sense if it affects other things in your portfolio negatively. Or makes things more complicated. Or does not serve your purposes in some way.

If you have $80k in the fund the difference in cost is $88 a year. Is having another account at another brokerage worth that to you? What happens to your 403b if you take the international out? Will you have a way to add money to the rollover IRA? If now, how will you keep your international allocation up to target?

The overall picture is what counts and what a change is worth to you. It should not be about getting something for free, especially if you are giving something up to get it.
Thanks for the response, retirejg —— yes, was thinking I would open perhaps a separate Roth for additional international if I wanted to add to what was already in the rollover.

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 3:39 pm

workerbeeengineer wrote:
Sat Aug 25, 2018 10:11 am
Zero ER is good, but you seem to acknowledge that you will need to either give up international small cap exposure or actually have to open two accounts at Fidelity. Only you can decide if the reduction in cost from the 0.11% ER going away justifies the added complexity. I'm sure lots of opinions are available here. :happy
Thanks Worker !!

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 3:46 pm

2cents2 wrote:
Sat Aug 25, 2018 10:11 am
If it fits in with your overall plan.
Your 403B rollover to a tIRA will complicate things if you plan to do non deductible contribution(s) to a tIRA followed by a conversion(s) to a Roth in the future.

I converted DH's international to FZILX (once I got over my initial shock and skepticism :happy :) ), but he was already at Fidelity.
Thanks 2 cents —— I don’t have and didn’t know about potential non-deductible nature of a tIRA , since I already have a workplace retirement plan. Learn something every day ! :happy

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 3:51 pm

rgs92 wrote:
Sat Aug 25, 2018 11:00 am
I still stick with Vanguard Balanced Index and the Fidelity Freedom Index funds because I like the idea of continuous re-balancing, hoping it will smooth out the ride. (Of course, hope is not a strategy, but I do it anyway, like it's a lucky charm in my pocket.)
Thanks for the thoughts, rgs —— Am thinking about Vanguard Balanced maybe for someday.

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 4:06 pm

Leif wrote:
Sat Aug 25, 2018 10:33 am
I would not want to lose international small caps exposure in a tax deferred account. Small caps give you the best international diversification since it is not as closely tied to want is happening in the US.

Taxable account is another story. I'm thinking about the international zero in the taxable account. But, I'll wait a few years to see the funds results and tax efficiency.
Very interesting, Leif, thanks a bunch ! Didn’t know that, so in your opinion you’d recommend keeping the Vanguard total International !?
Sorry, am a little tired and not THAT financially fluent, but you see a place for Vanguard total international in a Roth too ? (I.e. , did you mean a benefit to have int. small caps in tax-advantaged generally or just tax deferred ? Hope I’m making sense .....)
Thanks again, much appreciation.

ThePrince
Posts: 357
Joined: Sun Aug 20, 2017 9:15 pm
Location: U.S.A.

Re: Move some over to Fidelity ZERO ?

Post by ThePrince » Sat Aug 25, 2018 5:25 pm

NestEggLove wrote:
Sat Aug 25, 2018 9:39 am
Hello all,
Was just debating whether to move the Vanguard Total International portion of my 403B (about 80k) over to a rollover IRA in the new Fidelity Zero international.
I don’t think I’d mind losing the small caps, but of course it’s the expense ratio that catches my attention (.11 to 0). I’m figuring if I want to add international I can always open a Roth at Fidelity in the same fund.

Any thoughts? Still wait ?
Thanks for all the advice you give ....
I wouldn’t be willing to give up exposure to small caps for .11 ER difference. You may be swapping dimes for nickels.

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 5:34 pm

Thanks Prince :thumbsup

2cents2
Posts: 328
Joined: Sun Mar 02, 2014 11:31 am

Re: Move some over to Fidelity ZERO ?

Post by 2cents2 » Sat Aug 25, 2018 5:37 pm

NestEggLove wrote:
Sat Aug 25, 2018 3:46 pm

Thanks 2 cents —— I don’t have and didn’t know about potential non-deductible nature of a tIRA , since I already have a workplace retirement plan. Learn something every day ! :happy
To further explain--Read this: https://thefinancebuff.com/the-backdoor ... ow-to.html .

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 6:39 pm

2cents2 wrote:
Sat Aug 25, 2018 5:37 pm
NestEggLove wrote:
Sat Aug 25, 2018 3:46 pm

Thanks 2 cents —— I don’t have and didn’t know about potential non-deductible nature of a tIRA , since I already have a workplace retirement plan. Learn something every day ! :happy
To further explain--Read this: https://thefinancebuff.com/the-backdoor ... ow-to.html .
Thanks 2 cents !! Really appreciate it !

sambb
Posts: 2165
Joined: Sun Mar 10, 2013 3:31 pm

Re: Move some over to Fidelity ZERO ?

Post by sambb » Sat Aug 25, 2018 6:55 pm

would definitely move over to fido.
for some reason, some threads seem to think lower expense ratios are ok only when it is vanguard with the lower ratio. Similar to customer service - good is expected, except when it comes to vanguard. It may be a biased audience for certain questions or certain responders. I think that both fidelity and vanguard are great with low expense ratios.

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sat Aug 25, 2018 7:39 pm

Thanks Sam, learned though that going from Vanguard International to Fidelity zero might be a little “apples to oranges” though, regarding small caps or lack of.

gostars
Posts: 439
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Re: Move some over to Fidelity ZERO ?

Post by gostars » Sat Aug 25, 2018 10:57 pm

Note that you do have an option in between, you can invest in Fidelity's Total International Index (FTIHX) at .06% ER. Still beats Vanguard, but maintains small caps. Or go 50/50 FTIHX/FZILX and end up at an average .03% ER and compare the two as you go to see which ends up ahead years down the road.

sambb
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Joined: Sun Mar 10, 2013 3:31 pm

Re: Move some over to Fidelity ZERO ?

Post by sambb » Sat Aug 25, 2018 11:08 pm

fidelity beats vanguard on expense ratios of most bh funds

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Leif
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Re: Move some over to Fidelity ZERO ?

Post by Leif » Sat Aug 25, 2018 11:25 pm

NestEggLove wrote:
Sat Aug 25, 2018 4:06 pm
\
Very interesting, Leif, thanks a bunch ! Didn’t know that, so in your opinion you’d recommend keeping the Vanguard total International !?
Sorry, am a little tired and not THAT financially fluent, but you see a place for Vanguard total international in a Roth too ? (I.e. , did you mean a benefit to have int. small caps in tax-advantaged generally or just tax deferred ? Hope I’m making sense .....)
Thanks again, much appreciation.
Yes. Or FTIPX at 6 bp (vs. 11 bp for Vanguard). But I don't think it will make much of a difference. More important considerations are convenience and service. Roth would be a good place. It depends on how much room you have vs. your asset allocation. I keep REITs and International Small Value in my Roth since REITs should not be in taxable and I want to keep my ISV fund in tax deferred. However, not everyone is as tax focused as I am.

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sun Aug 26, 2018 7:17 am

gostars wrote:
Sat Aug 25, 2018 10:57 pm
Note that you do have an option in between, you can invest in Fidelity's Total International Index (FTIHX) at .06% ER. Still beats Vanguard, but maintains small caps. Or go 50/50 FTIHX/FZILX and end up at an average .03% ER and compare the two as you go to see which ends up ahead years down the road.
Great ideas, GoStars —-thanks !

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sun Aug 26, 2018 7:29 am

Leif wrote:
Sat Aug 25, 2018 11:25 pm
NestEggLove wrote:
Sat Aug 25, 2018 4:06 pm
\
Very interesting, Leif, thanks a bunch ! Didn’t know that, so in your opinion you’d recommend keeping the Vanguard total International !?
Sorry, am a little tired and not THAT financially fluent, but you see a place for Vanguard total international in a Roth too ? (I.e. , did you mean a benefit to have int. small caps in tax-advantaged generally or just tax deferred ? Hope I’m making sense .....)
Thanks again, much appreciation.
Yes. Or FTIPX at 6 bp (vs. 11 bp for Vanguard). But I don't think it will make much of a difference. More important considerations are convenience and service. Roth would be a good place. It depends on how much room you have vs. your asset allocation. I keep REITs and International Small Value in my Roth since REITs should not be in taxable and I want to keep my ISV fund in tax deferred. However, not everyone is as tax focused as I am.
Thanks for the insight, Leif !!

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peterinjapan
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Location: Japan!

Re: Move some over to Fidelity ZERO ?

Post by peterinjapan » Sun Aug 26, 2018 8:07 am

I love Fidelity, great company and great products, and great iOS apps.

The one thing I hate is the $75 charge if I want to buy a mutual fund that's not covered on their free program. Many of the ones Bogleheads use from Vanguard, Dodge and Cox income, and a few others are all unavailable to me.

It's the only complaint of the otherwise outstanding company.

NestEggLove
Posts: 19
Joined: Thu Jul 05, 2018 9:22 am

Re: Move some over to Fidelity ZERO ?

Post by NestEggLove » Sun Aug 26, 2018 8:57 am

peterinjapan wrote:
Sun Aug 26, 2018 8:07 am
I love Fidelity, great company and great products, and great iOS apps.

The one thing I hate is the $75 charge if I want to buy a mutual fund that's not covered on their free program. Many of the ones Bogleheads use from Vanguard, Dodge and Cox income, and a few others are all unavailable to me.

It's the only complaint of the otherwise outstanding company.
:thumbsup

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