Vanguard Incorrect RMD Banner Info

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Vanguard Incorrect RMD Banner Info

Post by schachtw » Tue Jan 14, 2020 6:38 pm

I logged into my Vanguard account yesterday, and navigated to the RMD tab. I'll turn 69 1/2 this year, and without passage of the Secure Act, would have been eligible to enroll in Vanguard's RMD service.

That said, I was surprised to read the following banner notification:
Our records show you will turn 70 1/2 in 2021, and will need to take a Required Minimum Distribution (RMD) from your retirement account. You can sign up for the RMD service now, and have your RMD taken out automatically".

I called VG, and was told their IT department is aware of the problem and is working on a solution. I came from an IT/coder background - seems like rudimentary 'if then else or case" logic would solve the problem. We'll see how long this correction takes.

Alan S.
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Re: Vanguard Incorrect RMD Banner Info

Post by Alan S. » Tue Jan 14, 2020 8:51 pm

This is much more urgent for those reaching 70.5 in 2020. I wonder if some distributions are being made now for those who are not subject to RMDs in 2020, but who signed up for RMD service sometime last year. And some of those may not have a rollover available to roll back any distribution.

This one's on Congress, not Vanguard (yet). They simply do not care about the consequences of passing major legislation that takes effect in 10 days. That's two of the last 3 years.

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Re: Vanguard Incorrect RMD Banner Info

Post by Blake7 » Tue Jan 14, 2020 9:58 pm

Vanguard has been having IT issues recently. I transferred $7k to my Roth and $6 to DW’s Roth on 1/1/20. The funds were sourced from our Vanguard joint taxable account. On 1/10/20, I called Vanguard because the transactions still had not completed. The agent was helpful and explained there had been a glitch. Still, I was annoyed by the whole thing.

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Re: Vanguard Incorrect RMD Banner Info

Post by NewishBog » Tue Jan 14, 2020 10:21 pm

10 days is not enough to make a change like this. The people involved in deciding to make this change were probably on vacation during the timeframe involved. It probably took several days for key parties to even become aware of the change in the law. The change is more involved than just the banner on the screen. All their systems that might be affected need to be researched, evaluated, and a game plan developed. And companies aren't going to go DEFCON 1 and drop all their other projects while this is addressed. DEFCON 3 or 4, maybe.

Change the banner and then the perception is everything is a-okay, which is not the case. Better to address the problem thoroughly and properly than to change the banner and have everything else screwed up.

It's always best not to try to quickly take advantage of any new law. Because the systems probably haven't been properly updated.

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