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Moving to Vanguard from Edward Jones, Advice Needed

Posted: Thu Sep 06, 2018 4:55 pm
by lexaunculpt
I'm finally making the move from EJ to Vanguard and have gotten the ball rolling on the paperwork. I will have about 30k coming over to Vanguard which I intend to put into a 3 fund portfolio. What I'm wondering is if someone can explain if I should move the money into the Vanguard Funds incrementally over some period of time (is this called "Dollar Cost Averaging?") or simply to drop it into their respective 3 funds immediate with the full sum of money. Thanks for any advice!

Emergency funds: Finishing up 3 months of funds shortly
Debt: No debt but Mortgage (@3.625%)
Tax Filing Status: Married
Tax Rate: Unsure (sorry!) Wife and I gross about 200k total (both members of teacher retirement system- CALSTRS)
State of Residence: California
Age: 39
Desired Asset allocation: 65% stocks / 35% bonds
Desired International allocation: not sure

Is there an employer match offered in your work-based plan? If so what is it? How much (in dollars) do you have to contribute annually to get the full employer match each year?
No match. I am part of a traditional Defined Benefit Plan where the benefit is calculated from a formula (years served x 2% x final year salary) and everything I'm doing is to supplement that plan.

Do you have any debt? If so what types, amounts, and interest rates?
Mortgage only. 685k/30 year load @3.625%

Re: Moving to Vanguard from Edward Jones, Advice Needed

Posted: Thu Sep 06, 2018 5:09 pm
by Duckie
lexaunculpt wrote:I will have about 30k coming over to Vanguard which I intend to put into a 3 fund portfolio. What I'm wondering is if someone can explain if I should move the money into the Vanguard Funds incrementally over some period of time (is this called "Dollar Cost Averaging?") or simply to drop it into their respective 3 funds immediate with the full sum of money.
Dollar Cost Averaging is a method of contributing new money. That's not the case here. Since this appears to be an IRA (based on previous posts) you can buy what you want at once. There's no reason to wait.

However, since you have other retirement accounts you should look at all of them as one big portfolio and not necessarily buy all three funds in this account. This account would be good for something your employer plans don't offer, such as a complete international stock fund.

Re: Moving to Vanguard from Edward Jones, Advice Needed

Posted: Thu Sep 06, 2018 5:12 pm
by badbreath
Its only $30k so I would put it all in at once.

Also read https://rickferri.com/6-ideas-for-lump-sum-investing/

Re: Moving to Vanguard from Edward Jones, Advice Needed

Posted: Thu Sep 06, 2018 6:48 pm
by billfromct
Since it appears to be in an IRA with EJ, transfer the EJ IRA into a money market fund in your EJ IRA. It's easier to move cash via a "trustee to trustee" transfer to Vanguard.

You can put the transferred money into a Vanguard money market fund in your new Vanguard IRA. Then you can move the money into your desired Vanguard IRA allocation.

Vanguard can help with the details.

bill

Re: Moving to Vanguard from Edward Jones, Advice Needed

Posted: Thu Sep 06, 2018 7:08 pm
by CABob
Since the money is presumably invested in something at EJ is would be a sideways move to the investments at VG. Therefore, I see no reason to do it in increments. If you would be more comfortable with doing this in increments do it. Perhaps a third every month for three months.

Re: Moving to Vanguard from Edward Jones, Advice Needed

Posted: Thu Sep 06, 2018 9:05 pm
by dwickenh
Once you decide on the lump sum investment or the dollar cost averaging, just remember to leave it alone and let compounding do its magic.

You may have to re-balance to make sure you keep your 65/35 desired allocation, but that will not be often.

Best of luck to you at Vanguard, I am a satisfied Vanguard customer.

Dan

Re: Moving to Vanguard from Edward Jones, Advice Needed

Posted: Thu Sep 06, 2018 9:08 pm
by sambb
30k is a fairly small sum, i would lump sum, but if you have doubts, it isnt bad to DCA also. Once you leave EJ, the rest is small stuff. It probably doesnt matter too much no matter what you decide.