Owning 2 accounts of Roth ira

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Topic Author
Pebbles555
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Joined: Tue Mar 05, 2019 6:04 am

Owning 2 accounts of Roth ira

Post by Pebbles555 » Wed May 01, 2019 7:15 am

Last February 2019 I opened my Roth IRA at fidelity and invested money worth 1000 but stop contributing on that account. Now, I decided to have all my account in vanguard and I wanted to open a Roth IRA from vanguard.

The question is, can I open another Roth IRA account in vanguard? Is it allowed? Just planning to keep the fidelity Roth IRA but will stop the contribution and whatever the remaining amount left I will contribute to vanguard Roth IRA.

Thank you.

The Wizard
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Location: Reading, MA

Re: Owning 2 accounts of Roth ira

Post by The Wizard » Wed May 01, 2019 7:20 am

Sure, you can have multiple IRA accounts.
Just need to keep track of total contributions each year and not exceed the limit...
Attempted new signature...

lakpr
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Re: Owning 2 accounts of Roth ira

Post by lakpr » Wed May 01, 2019 7:32 am

Just curious, why not add to the same account at Fidelity instead of opening at Vanguard?

ivk5
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Re: Owning 2 accounts of Roth ira

Post by ivk5 » Wed May 01, 2019 7:35 am

lakpr wrote:
Wed May 01, 2019 7:32 am
Just curious, why not add to the same account at Fidelity instead of opening at Vanguard?
Or move the fidelity acct to Vanguard?

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Wiggums
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Re: Owning 2 accounts of Roth ira

Post by Wiggums » Wed May 01, 2019 7:45 am

The Wizard wrote:
Wed May 01, 2019 7:20 am
Sure, you can have multiple IRA accounts.
Just need to keep track of total contributions each year and not exceed the limit...
+1

FederalFIRE
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Re: Owning 2 accounts of Roth ira

Post by FederalFIRE » Wed May 01, 2019 7:57 am

As others have said, it seems odd to keep an account at Fidelity where you've only put in $1,000 and plan to stop contributing. If the primary reason is that you would prefer to have your assets at Vanguard, then it might make more sense for you to transfer the Fidelity account to Vanguard rather than opening a new one.

Topic Author
Pebbles555
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Re: Owning 2 accounts of Roth ira

Post by Pebbles555 » Thu May 02, 2019 12:22 am

I started the investment in fidelity but decided to invest in vanguard both taxable and roth. My husband later will roll over his 403b to vanguard. I decided to keep all accounts in one brokerage.

If i will transfer my fidelity roth ira, do i need to sell the index fund before i can roll over it to vanguard roth ira???

FederalFIRE wrote:
Wed May 01, 2019 7:57 am
As others have said, it seems odd to keep an account at Fidelity where you've only put in $1,000 and plan to stop contributing. If the primary reason is that you would prefer to have your assets at Vanguard, then it might make more sense for you to transfer the Fidelity account to Vanguard rather than opening a new one.

Topic Author
Pebbles555
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Joined: Tue Mar 05, 2019 6:04 am

Re: Owning 2 accounts of Roth ira

Post by Pebbles555 » Thu May 02, 2019 12:23 am

Because i am planning to buy bonds in vanguard and i want it to put the bonds in vanguard roth ira.
lakpr wrote:
Wed May 01, 2019 7:32 am
Just curious, why not add to the same account at Fidelity instead of opening at Vanguard?

ivk5
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Re: Owning 2 accounts of Roth ira

Post by ivk5 » Thu May 02, 2019 2:09 am

No need to sell. Do the transfer in-kind. And definitely don’t withdraw (take a distribution).

Most here would advise against bonds in Roth. See wiki re tax-efficient funds placement (EDIT: link).
Last edited by ivk5 on Thu May 02, 2019 2:38 am, edited 1 time in total.

FederalFIRE
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Re: Owning 2 accounts of Roth ira

Post by FederalFIRE » Thu May 02, 2019 2:14 am

Pebbles555 wrote:
Thu May 02, 2019 12:22 am
I started the investment in fidelity but decided to invest in vanguard both taxable and roth. My husband later will roll over his 403b to vanguard. I decided to keep all accounts in one brokerage.

If i will transfer my fidelity roth ira, do i need to sell the index fund before i can roll over it to vanguard roth ira???
The easiest way will be to just call Vanguard and speak to a rep there. No need to sell your funds, and as was said, do NOT take the money as a distribution and move it that way. You would be hit with taxes if you do that. When you call Vanguard just tell them you want to move your Fidelity Roth IRA to Vanguard. They’ll take account details for Fidelity and do all the work for you.
Last edited by FederalFIRE on Thu May 02, 2019 5:31 am, edited 1 time in total.

Topic Author
Pebbles555
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Re: Owning 2 accounts of Roth ira

Post by Pebbles555 » Thu May 02, 2019 5:29 am

Thank you for you time to reply. Will do that then...
FederalFIRE wrote:
Thu May 02, 2019 2:14 am
Pebbles555 wrote:
Thu May 02, 2019 12:22 am
I started the investment in fidelity but decided to invest in vanguard both taxable and roth. My husband later will roll over his 403b to vanguard. I decided to keep all accounts in one brokerage.

If i will transfer my fidelity roth ira, do i need to sell the index fund before i can roll over it to vanguard roth ira???
The easiest way will be to just call Vanguard and speak to a rep there. No need to sell your funds, and as was said, so NOT take the money as a distribution and move it that way. You would be hit with income taxes if you do that. When you call Vanguard just tell them you want to move your Fidelity Roth IRA to Vanguard. They’ll take account details for Fidelity and do all the work for you.

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TomatoTomahto
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Re: Owning 2 accounts of Roth ira

Post by TomatoTomahto » Thu May 02, 2019 6:02 am

Pebbles555 wrote:
Thu May 02, 2019 12:23 am
Because i am planning to buy bonds in vanguard and i want it to put the bonds in vanguard roth ira.
lakpr wrote:
Wed May 01, 2019 7:32 am
Just curious, why not add to the same account at Fidelity instead of opening at Vanguard?
Generally, bonds aren’t recommended in Roth accounts, but rather to go in traditional (IRA, 401k, 403b, etc).
Okay, I get it; I won't be political or controversial. The Earth is flat.

Topic Author
Pebbles555
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Re: Owning 2 accounts of Roth ira

Post by Pebbles555 » Thu May 02, 2019 10:08 am

I thought bonds are ok to put in ira whether in traditional or roth ira. Would it be ok for me to buy bonds in taxable account? I am new in investment and i am just starting to invest.
Thank you.
TomatoTomahto wrote:
Thu May 02, 2019 6:02 am
Pebbles555 wrote:
Thu May 02, 2019 12:23 am
Because i am planning to buy bonds in vanguard and i want it to put the bonds in vanguard roth ira.
lakpr wrote:
Wed May 01, 2019 7:32 am
Just curious, why not add to the same account at Fidelity instead of opening at Vanguard?
Generally, bonds aren’t recommended in Roth accounts, but rather to go in traditional (IRA, 401k, 403b, etc).

ivk5
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Re: Owning 2 accounts of Roth ira

Post by ivk5 » Thu May 02, 2019 10:23 am

Pebbles555 wrote:
Thu May 02, 2019 10:08 am
I thought bonds are ok to put in ira whether in traditional or roth ira. Would it be ok for me to buy bonds in taxable account? I am new in investment and i am just starting to invest.
Thank you.
See wiki link above.

carmonkie
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Re: Owning 2 accounts of Roth ira

Post by carmonkie » Thu May 02, 2019 10:44 am

Pebbles555 wrote:
Thu May 02, 2019 10:08 am
I thought bonds are ok to put in ira whether in traditional or roth ira. Would it be ok for me to buy bonds in taxable account? I am new in investment and i am just starting to invest.
Thank you.
TomatoTomahto wrote:
Thu May 02, 2019 6:02 am
Pebbles555 wrote:
Thu May 02, 2019 12:23 am
Because i am planning to buy bonds in vanguard and i want it to put the bonds in vanguard roth ira.
lakpr wrote:
Wed May 01, 2019 7:32 am
Just curious, why not add to the same account at Fidelity instead of opening at Vanguard?
Generally, bonds aren’t recommended in Roth accounts, but rather to go in traditional (IRA, 401k, 403b, etc).
Equities that are expected to appreciate in value fast and even REITS (bc of the non qualified dividends) are better in a Roth simply because they will grow tax free over x number of years.
Bonds on the other hand grow slower, but throw a lot of dividends which are taxed at ordinary income, for this reason it is preferred to be on 40x accounts and not in taxable accounts.

If you really need to buy bonds in taxable or you have ran out of bond space in your tax-deferred account, then tax-exempt bonds like state or muni bonds come in to play.

Spirit Rider
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Re: Owning 2 accounts of Roth ira

Post by Spirit Rider » Thu May 02, 2019 2:37 pm

FederalFIRE wrote:
Wed May 01, 2019 7:57 am
As others have said, it seems odd to keep an account at Fidelity where you've only put in $1,000 and plan to stop contributing. If the primary reason is that you would prefer to have your assets at Vanguard, then it might make more sense for you to transfer the Fidelity account to Vanguard rather than opening a new one.
IRA accounts don't transfer, just the assets.

You still have to open a new IRA account at Vanguard and transfer the assets from the Fidelity IRA account to the Vanguard account.

FederalFIRE
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Re: Owning 2 accounts of Roth ira

Post by FederalFIRE » Thu May 02, 2019 2:43 pm

Spirit Rider wrote:
Thu May 02, 2019 2:37 pm
FederalFIRE wrote:
Wed May 01, 2019 7:57 am
As others have said, it seems odd to keep an account at Fidelity where you've only put in $1,000 and plan to stop contributing. If the primary reason is that you would prefer to have your assets at Vanguard, then it might make more sense for you to transfer the Fidelity account to Vanguard rather than opening a new one.
IRA accounts don't transfer, just the assets.

You still have to open a new IRA account at Vanguard and transfer the assets from the Fidelity IRA account to the Vanguard account.
Yes yes, I was sloppy in language there. The fact stands that even calling Vanguard and saying you "want to transfer an account" will get the result the OP wants. But yes, a new account must be opened at Vanguard and the assets are transferred from Fidelity. If Fidelity handles it the same as TD did in my case, then the Fidelity account itself would be automatically closed once the assets are moved to Vanguard. While it's technically the assets that moved from one account to the other, to the user it "feels" like the account was moved. Nonetheless, point taken.

lakpr
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Re: Owning 2 accounts of Roth ira

Post by lakpr » Thu May 02, 2019 5:27 pm

FederalFIRE wrote:
Thu May 02, 2019 2:43 pm
Spirit Rider wrote:
Thu May 02, 2019 2:37 pm
FederalFIRE wrote:
Wed May 01, 2019 7:57 am
As others have said, it seems odd to keep an account at Fidelity where you've only put in $1,000 and plan to stop contributing. If the primary reason is that you would prefer to have your assets at Vanguard, then it might make more sense for you to transfer the Fidelity account to Vanguard rather than opening a new one.
IRA accounts don't transfer, just the assets.

You still have to open a new IRA account at Vanguard and transfer the assets from the Fidelity IRA account to the Vanguard account.
Yes yes, I was sloppy in language there. The fact stands that even calling Vanguard and saying you "want to transfer an account" will get the result the OP wants. But yes, a new account must be opened at Vanguard and the assets are transferred from Fidelity. If Fidelity handles it the same as TD did in my case, then the Fidelity account itself would be automatically closed once the assets are moved to Vanguard. While it's technically the assets that moved from one account to the other, to the user it "feels" like the account was moved. Nonetheless, point taken.
From the IT world:

Move = Create a copy + Delete

FederalFIRE
Posts: 214
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Re: Owning 2 accounts of Roth ira

Post by FederalFIRE » Fri May 03, 2019 4:23 am

lakpr wrote:
Thu May 02, 2019 5:27 pm
FederalFIRE wrote:
Thu May 02, 2019 2:43 pm
Spirit Rider wrote:
Thu May 02, 2019 2:37 pm
FederalFIRE wrote:
Wed May 01, 2019 7:57 am
As others have said, it seems odd to keep an account at Fidelity where you've only put in $1,000 and plan to stop contributing. If the primary reason is that you would prefer to have your assets at Vanguard, then it might make more sense for you to transfer the Fidelity account to Vanguard rather than opening a new one.
IRA accounts don't transfer, just the assets.

You still have to open a new IRA account at Vanguard and transfer the assets from the Fidelity IRA account to the Vanguard account.
Yes yes, I was sloppy in language there. The fact stands that even calling Vanguard and saying you "want to transfer an account" will get the result the OP wants. But yes, a new account must be opened at Vanguard and the assets are transferred from Fidelity. If Fidelity handles it the same as TD did in my case, then the Fidelity account itself would be automatically closed once the assets are moved to Vanguard. While it's technically the assets that moved from one account to the other, to the user it "feels" like the account was moved. Nonetheless, point taken.
From the IT world:

Move = Create a copy + Delete
At the risk of having a pedantic discussion (too late) the description on Vanguard’s website to “Transfer an account” is to “Move nonretirement or IRA assets from another financial institution to a new or existing Vanguard account.”

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