IRA rollover questions

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investor4life
Posts: 92
Joined: Fri Oct 08, 2010 9:45 am

IRA rollover questions

Post by investor4life » Tue Feb 13, 2018 1:32 am

I plan to transfer in-kind to Vanguard the following two IRAs: a traditional IRA at Fidelity (invested in Contrafund and Low-Price Stock) and a SEP-IRA at American Century (invested in Ultra Fund). I've never done one of these transfers, so have some questions:

1) Can I combine the traditional and SEP-IRA into a single traditional IRA at Vanguard?

2) If the answer to 1) is "yes": When the IRAs transfer over in-kind to my single Vanguard IRA, my understanding is that the money will still be invested in Contra, Low-Priced, and Ultra. I can then choose to sell them and buy Vanguard funds in the IRA (probably a Target Retirement fund). Is this correct?

3) Can all this be done purely online or will I have to go the paper route with Medallion Signature Guarantees?

4) Any other things to be aware of? I assume that this sort of in-kind transfer and sell/buy will have no tax implications.

5) There will also be a 401k rollover (of a past employer) to a Vanguard IRA in my future. Can I invest those funds into the single Vanguard IRA mentioned above? (I understand that a 401k rollover is a whole new ballgame, involving paper checks etc., so will defer questions on that to a bit later. (But feel free to comment on that now if you like.)

Thanks, as always, for your patience and wisdom!

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Watty
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Joined: Wed Oct 10, 2007 3:55 pm

Re: IRA rollover questions

Post by Watty » Tue Feb 13, 2018 5:47 am

investor4life wrote:
Tue Feb 13, 2018 1:32 am
I plan to transfer in-kind to Vanguard the following two IRAs....
The best thing to do would be to call Vanguard and let then walk you through the process since they have people that specialize in account transfers.

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Duckie
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Joined: Thu Mar 08, 2007 2:55 pm

Re: IRA rollover questions

Post by Duckie » Tue Feb 13, 2018 7:37 pm

investor4life wrote:Can I combine the traditional and SEP-IRA into a single traditional IRA at Vanguard?
Yes. It might be better to have the account titled as a Rollover IRA rather than TIRA.
When the IRAs transfer over in-kind to my single Vanguard IRA, my understanding is that the money will still be invested in Contra, Low-Priced, and Ultra. I can then choose to sell them and buy Vanguard funds in the IRA (probably a Target Retirement fund). Is this correct?
It's correct, but if you don't want to keep those funds you can sell them at your current custodians and transfer cash instead of transferring "in kind" and selling at Vanguard. Find out which will be cheaper.
Can all this be done purely online or will I have to go the paper route with Medallion Signature Guarantees?
Usually IRA trustee-to-trustee transfers don't required an MSG. Check with Vanguard.
Any other things to be aware of? I assume that this sort of in-kind transfer and sell/buy will have no tax implications.
There will be no tax implications for the rollover. However, if you ever need to use the Backdoor Roth IRA method, this pre-tax IRA will get in the way.
There will also be a 401k rollover (of a past employer) to a Vanguard IRA in my future. Can I invest those funds into the single Vanguard IRA mentioned above?
Yes.

investor4life
Posts: 92
Joined: Fri Oct 08, 2010 9:45 am

Re: IRA rollover questions

Post by investor4life » Tue Feb 13, 2018 10:09 pm

Thanks, Duckie, for your point-by-point response. Much appreciated!

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