Request Review of Retirement Accounts Consolidation!

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yankees60
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Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

Request Review of Retirement Accounts Consolidation!



I have been attempting for the last three year to consolidate my many retirement accounts (all Vanguard) into as few accounts as possible.
I'm now at the maximum motivation to complete this process due to several impending EVENTS.

E1. 2024 is my first year doing Required Minimum Distributions.

E2. Vanguard changes in policies.

a. Vanguard is charging $25 to get a paper statement for each account you have with them.

Last year I pled my case with them, resulting in them giving me a waiver from these 2023 fees. Currently having 10 accounts subject to this fee; total fees would be $250 per year.

I desire paper statements. I don't have access to a printer (I believe that it is multiple times more efficient (and green!) for Vanguard to print them rather than each person doing it individually). I'm not asking for discussion / advice regarding this.

b. Effective July 1, 2024 Vanguard "may" charge $100 for each account transferred outside of Vanguard. Discussed this with a Vanguard small business representative on 6/18/24. She did not know under what circumstances they will charge this fee.

c. Transferring certain business retirement accounts currently with Vanguard to Ascensus.
"After July 19, 2024, Vanguard's multi-participant SEP-IRA, SIMPLE IRA, and Individual 401(k) retirement plans are transitioning to Ascensus."

I've only briefly glanced at Ascensus's fees but it seems like fees will be more expensive than they have been at Vanguard. And, more importantly, it'd not be Vanguard -- who's held all my investment / retirement money since January 2003. However, I did learn in that 6/18/24 call that only my Individual (Solo) 401(k) would be affected by this.




All my financial activity (including all investing transactions) since 1/1/93 is in Quicken.

Three years ago I entered into Quicken all missing investment activity since the first one in 1982 to 1992 so that ALL investment activity would be in it. From 1982 to present I've had about 100 different retirement investment funds.

Using Quicken I exported different information into various Excel worksheets:

a) To be certain how much I contributed to each of the various retirement plans so as to establish any initial required basis for Federal / MA tax purposes.

b) Noting in those worksheets which of those contributions resulted in reducing Federal or MA taxes or both, or, gave no current tax benefit.

c) Finally, analyzing transfers back and forth between various funds so as to determine the current account location for all the initial contributions (plus their subsequent earnings / losses).




For each of the years of doing RETIREMENT INVESTING I've been either a) only an employee, b) only self-employed, or c) both. Consequently, I currently possess many different type retirement accounts.

My retirement investing HISTORY.

(NOTE: A Massachusetts resident since 1973 / Massachusetts tax return instructions:
"Payments to an IRA, Keogh, Simplified Employee Pension Plan (SEP), or Savings Incentive Match Plan for Employees (SIMPLE) Account are not deductible for Massachusetts income tax purposes"

I1. TRADITIONAL IRA - First one on 4/20/82 for $1,500 (to Bull & Bear Dollar Reserves!) for 1981 tax return. Subsequently, did the maximum allowable each year until the Roth IRA came into existence in 1998, whereupon all those prior Traditional IRAs were immediately converted to Roth IRAs.
1a. [Federal deductions when contributions made but not in MA. For Roth Conversion fully taxed Federal but no MA tax on contribution portion.]
1b. [Currently in A7. Roth IRA Brokerage Account #1 (below).]

I2. NON-DEDUCTIBLE IRA - Started with the 1987 tax return, when not allowed to do Traditional IRA's due to having my own self-employed business retirement plans. All of these were also converted to Roth in 1998.
2a. [No deductions either Federal / MA when contributions made. Contribution portion not taxed Federal / MA upon 1998 Roth conversion.]
2b. [Currently in A7. Roth IRA Brokerage Account #1 (below).]

I3. ROTH IRA - In addition to the above conversions (I1. & I2.) …. since Roth came into existence in 1998 have always done the maximum allowable contribution each year.
3a. [No deductions when contributions made. Withdrawals will not be taxed.]
3b. [Currently in A7. Roth IRA Brokerage Account #1 (below).]

I4. 403(b) / 457 DEFINED CONTRIBUTION - Contributed to both of these while a University employee (1987-88).
4a. [Each reduced Federal / MA wages.]
4b. [Currently in A1. Rollover IRA Brokerage Account #1 (below).]

I5. 401(k) / PROFIT SHARING (Employee #1) - From 1992 to 1995. Employee / Matching Employer contributions & Employer Profit Sharing Contributions.
5a. [Employee portion reduced Federal / MA wages. Employer Match not included in Federal / MA income.] [Profit Sharing not taxed when received. Fully taxed Federal / MA upon 1998 Roth conversion.]
5b. [401(k) currently in A1. Rollover IRA Brokerage Account #1 (below).] [Profit Sharing converted to Roth in 1998 and is currently in A7. Roth IRA Brokerage #1 (below)]

I6. 401(k) / PROFIT SHARING & SAFE HARBOR (Employee #2) - From 2007 to 2013 contributed to both Traditional and Roth 401(k) (NO Employer Match). Also, Employer Profit Sharing and Safe Harbor Contributions.
6a. [Traditional Contributions reduced both Federal / MA wages. Roth contributions did not. Income not recognized Federal / MA for Profit Sharing & Safe Harbor.]
6b. [Traditional 401(k) portion / Profit Sharing / Safe Harbor currently in A1. Rollover IRA Brokerage Account #1 (below).] [Roth 401(k) portion currently in A8. Roth IRA Brokerage Account #2 (below).]

I7. SIMPLE IRA (Employee #3) - Contributed 3% in 2020 to get the maximum Employer Match of 3%.
7a. [Employee portion reduced Federal / MA wages. No income recognized on Employer Match.]
7b. [Currently in A3. Rollover IRA Brokerage Account #3 (below).]

I8. KEOGH - Maximum contributions for 1985 - 1988 tax returns.
8a. [Deducted Federal / Not MA.]
8b. [Currently in A5. SEP-IRA Brokerage Account (below).]

I9. MONEY PURCHASE (401 a) - Maximum contributions for 1989 to 2009 tax returns.
9a. [Deducted Federal / Not MA.]
9b. [Currently in A5. SEP-IRA Brokerage Account (below).]

I10. SEP-IRA (408k) - Maximum contributions for 2010 to 2011 tax returns.
10a. [Deducted Federal / Not MA.]
10b. [Currently in A5. SEP-IRA Brokerage Account (below); except for $7,000 converted to ROTH (Taxed in Federal but not in MA) / currently in A10. Roth IRA Brokerage Account #4 (below).]

I11. SIMPLE IRA - Maximum Employee / Employer contributions for 2012 to 2014 tax returns.
11a. [Deducted Federal / Not MA.]
11b. [Currently in A2. Rollover IRA Brokerage Account #2 (below).]

I12. INDIVIDUAL [SOLO] 401(k) - Maximum Employee / Employer contributions each year for 2015 to 2023 tax returns. Mostly Roth contributions: For certain years for tax purposes some Employee contributions designated as Traditional rather than Roth. Employer contributions required to be Traditional.
12a. [Traditional portion deducted Federal / Not MA. No deductions for Roth portion.]
12b. [Traditional portion currently in A4. Rollover IRA Brokerage Account #4 (below).] [Roth portion balance as of 12/27/22 currently in A9. Roth IRA Brokerage Account #3 (below) / Subsequent contributions to 12/27/22 currently in A6. Individual Roth 401(k) (below).]



ROTH CONVERSIONS

For the 1998 Roth conversion consisting of almost all existing IRA accounts …. in determining tax returns income did account for the different proper basis for Federal and State to determine the amount to be included in income for each.

For 2012 did a Roth conversion of $6,500 from a Rollover IRA account. Properly included this in Federal Income but IMPROPERLY also included it as MA income.

For 2022 did a Roth conversion of $7,000 from the SEP-IRA account. Included it in Federal income while properly did NOT include it in MA income.




As a result of all of the above, these are CURRENT RETIREMENT HOLDINGS -- All at Vanguard.


SUBJECT to Required Minimum Distributions (5):

A1. Rollover IRA Brokerage Account #1
[From I4. 403(b) / 457 Defined Contribution -- I5. 401(k) -- I6. 401(k) / Profit Sharing & Safe Harbor]
[Employee contributions reduced Federal / MA wages. Employer contributions not included in income]
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX

A2. Rollover IRA Brokerage Account #2
[From I11. SIMPLE IRA]
[Deducted Federal / Not MA]
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX

A3. Rollover IRA Brokerage Account #3
[From I7. SIMPLE IRA]
[Employee contributions reduced Federal / MA wages. Employer contributions not included in income]
VANGUARD FEDERAL MONEY MARKET FUND VMFXX

A4. Rollover IRA Brokerage Account #4
[From I12. Individual (Solo) 401(k)]
[Deducted Federal / Not MA]
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX

A5. SEP-IRA Brokerage Account
[From I8. Keogh -- I9. Money Purchase -- I10. SEP-IRA]
[Deducted Federal / Not MA]
VANGUARD TOTAL STOCK MARKET INDEX ADMIRAL CL VTSAX
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX
VANGUARD REAL ESTATE INDEX ADMIRAL CL VGSLX
VANGUARD SHORT TERM INVESTMENT GRADE ADMIRAL CL VFSUX


NOT SUBJECT to Required Minimum Distributions (5):

A6. Individual Roth 401(k)
[From I12. Individual (Solo) 401(k)]
[No tax deductions taken]
Vanguard Treasury Money Market Fund VUSXX

A7. Roth IRA Brokerage Account #1
[From: I1. Traditional IRA -- I2. Non-Deductible IRA -- I3. Roth IRA -- I5. Profit Sharing]
[No tax deductions taken. Federal / MA taxes paid on Roth conversions]
VANGUARD VALUE INDEX ADMIRAL CL VVIAX
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX
VANGUARD SHORT TERM INVESTMENT GRADE INVESTOR CL VFSTX
VANGUARD SMALL CAP VALUE INDEX ADMIRAL CL VSIAX
VANGUARD EUROPEAN STOCK INDEX ADMIRAL CL VEUSX

A8. Roth IRA Brokerage Account #2
[From I6. 401(k)]
[No tax deductions taken]
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX

A9. Roth IRA Brokerage Account #3
[From I12. Individual (Solo) 401(k)]
[No tax deductions taken]
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX

A10. Roth IRA Brokerage Account #4
[From I10. SEP-IRA Roth conversion]
[Federal taxes paid (no MA) on Roth conversion]
VANGUARD TREASURY MONEY MARKET INVESTOR CL VUSXX

Note: I also have one non-retirement account consisting of the Vanguard Treasury Money Market Fund - VUSXX. It represents about 13% of my investable assets.



DECISIONS to make.

D1. How should the above accounts be consolidated? It's paramount I do not put any accounts together which do not have the same tax treatment for both Federal and MA tax purposes.

D1a. Two sets of consolidations could be:

A1. & A3.
[Employee contributions reduced Federal / MA wages. Employer contributions not included in income]

A2. & A4. & A5.
[Deducted Federal / Not MA]

The distinction between the two sets is while both sets would be taxed for Federal -- for the second set …. all the contribution amounts are MA exempt from being taxed.

Should all of five be consolidated?

Seems cleaner / more practical to keep them separate?

D1b. The next set of consolidations could be: A6 & A7 & A8 & A9 & A10
All are Roth accounts. Thus, have never given any tax benefits (necessary Federal / MA taxes were paid on Roth conversions). Any withdrawals will not be taxed by either Federal or MA. UNLESS ….. there is some kind of quirk of which I am completely ignorant.


D2. Do I want to have my accounts go to Adcensus as they are on their way to going if I do nothing? Or, do I want them to go elsewhere? It is important to me that I do have the Roth option for future contributions to my Individual (Solo) 401(k).

As part of the excellent discussion with the Vanguard small business representative, learned the following.
D2a. Since all my retirement accounts are one participant accounts the only account that is affected and subject to transfer to Adcensus is my Individual (Solo) 401(k).

Also, learned the following:
D2b. Unlimited transfers are allowed between retirement accounts.

Publications 590a supports this.
"A transfer of funds in your traditional IRA from one trustee directly to another, either at your request or at the trustee's request, isn’t a rollover. ..... Because there is no distribution to you, the transfer is tax free. Because it isn’t a rollover, it isn’t affected by the 1-year waiting period required between rollovers."
"Application of one-rollover-per-year limitation. ….. However, trustee-to-trustee transfers between IRAs aren’t limited and rollovers from traditional IRAs to Roth IRAs (conversions) aren’t limited."

D2c. If I wanted to close my Individual (Solo) 401(k) I could have done it with her on the phone that day and I'd have seen it online in Vanguard the next day. It did not seem that I needed to do anything else to close the Individual (Solo) 401(k). Because I've never reached the $250,000 5500-EZ threshold for this account .... I've never filed a 5500-EZ for it. She said I'd not have to file one upon closing the account.

This, however, is NOT supported by Publications 560.
"All plans should file a Form 5500-EZ for the final plan year to show that all plan assets have been distributed."
"All one-participant plans should file Form 5500-EZ for their final plan year. The final plan year is the year in which distribution of all plan assets is completed."

D2d. My practice is making all contributions (both Employee / Employer) about the week prior to filing my tax return by its initial due date. I've made my contributions for 2023. I will not be making contributions for 2024 until April 2025.

D2e. Given how much time I've already spent getting this far in all the above … I don't want to spend any time evaluating Adcensus. I only need some Individual (Solo) 401(k) in place so as to make contributions for 2024 to it in April 2025. Therefore, I'm strongly leaning towards first rolling over the existing balance in the Individual (Solo) 401(k) to the same Roth rollover account (A9.) where prior rollovers from it have gone. Next step would then be to close the Individual (Solo) 401(k).

D2f. To be able to make contributions in 2025 the representative stated that I needed to have another plan in place by December 31, 2024. Needed to check that one is able to close one Individual (Solo) 401(k) in one year and open a new one in the same year.

That, however, is NOT supported by Publications 560.
"Plans established after end of taxable year. For 2023 and later years, a sole-proprietor with no employees can adopt a section 401(k) plan after the end of the taxable year, provided the plan is adopted by the tax filing deadline (without regard to extensions)."

This raises the question, though, if I can terminate one Individual (Solo) 401(k) in the 2024 tax return year and then establish a new one for the 2024 tax year?
For now I'm leaving that as an open question for without delving into additional research regarding it.

D2g. Not all investment companies offer Individual (Solo) 401(k)'s. Of those that do … not all (e.g., Fidelity) offer the Roth version, which is a must for me. Looking for any recommendations.


D3. How do I redo all my investing into various type assets (Money Market / Bond / Equity) and where should each of their investment locations be, e.g., Tax deferred or Tax Free (Roth).


The first decision (D1.) is currently the paramount one. I need simplification and it will result in less $25 annual Vanguard fees per account eliminated. It seems that I am quite close to making a decision on the second one (D2.). The third one (D3.) I've been thinking of for 2+ decades. Once I accomplish all the consolidations (D1.) and made a decision regarding the Individual (Solo) 401(k) (D2.) I may FINALLY be able to both change my investments and their tax locations.


As you can see from the above I'm a dedicated index fund investor. My only other current investments are in iBonds and a tiny, tiny amount in gold. coins.

I will continue to buy the maximum iBonds each year. I would like to replace much of the Treasury Money Market investments with directly owning treasuries, both in TIPS versions and Regular versions.



For now, I am putting Decision D3 aside as the main topic for discussion here is how I should consolidate my various retirement accounts. The minor topic is what to do with my existing Individual (Solo) 401(k). How I should be investing for the future is not to be discussed here. Once I accomplish all prior to I will then bring that up for future discussion / advice.

Thanks for reading all the way through to here!
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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FiveK
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Re: Request Review of Retirement Accounts Consolidation!

Post by FiveK »

yankees60 wrote: Sun Jul 07, 2024 1:31 pm I have been attempting for the last three year to consolidate my many retirement accounts (all Vanguard) into as few accounts as possible.
I'm now at the maximum motivation to complete this process....

...
Should all of five be consolidated?

Seems cleaner / more practical to keep them separate?
The choice is yours: consolidate into as few accounts as possible, or keep them separate.
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retired@50
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Re: Request Review of Retirement Accounts Consolidation!

Post by retired@50 »

For the sake of your heirs, I would recommend simplification / consolidation.

Regards,
"All of us would be better investors if we just made fewer decisions." - Daniel Kahneman
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yankees60
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Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

retired@50 wrote: Sun Jul 07, 2024 5:12 pm For the sake of your heirs, I would recommend simplification / consolidation.

Regards,
I have NO heirs.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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retired@50
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Re: Request Review of Retirement Accounts Consolidation!

Post by retired@50 »

yankees60 wrote: Sun Jul 07, 2024 8:29 pm
retired@50 wrote: Sun Jul 07, 2024 5:12 pm For the sake of your heirs, I would recommend simplification / consolidation.

Regards,
I have NO heirs.
Well, let me try to re-frame the question...

Who will be your executor, or who will be left to deal with the estate you leave behind?

Regards,
"All of us would be better investors if we just made fewer decisions." - Daniel Kahneman
5outof10
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Re: Request Review of Retirement Accounts Consolidation!

Post by 5outof10 »

Admittedly, I couldn't read through all of what you wrote.

There are a ton of benefits in simplicity. First, I would consolidate all Roth's into one Roth. Second, I would consolidate all IRAs into one IRA. Third, I would consolidate all non-retirement accounts into one non-retirement account. Three accounts.

Then I would make sure to update the beneficiaries and the payable on death designations on these three accounts. Four if you keep a Treasury Direct account.

Setting the asset allocation would be my next priority. I would read the wiki here about that.

Best of luck.
Last edited by 5outof10 on Mon Jul 08, 2024 11:21 am, edited 1 time in total.
Checking 10K, Sinking Funds 50K (HYSA/MMF), EF 50K (I bonds), Taxable/Retirement: 72% VTI, 18% VXUS, 10% BND | I would like to own a gold bar one day, to be able to say I own a gold bar.
5outof10
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Re: Request Review of Retirement Accounts Consolidation!

Post by 5outof10 »

Edit: Delete redundant post.
Checking 10K, Sinking Funds 50K (HYSA/MMF), EF 50K (I bonds), Taxable/Retirement: 72% VTI, 18% VXUS, 10% BND | I would like to own a gold bar one day, to be able to say I own a gold bar.
Coastfical
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Re: Request Review of Retirement Accounts Consolidation!

Post by Coastfical »

It’s hard to understand exactly what you are trying to achieve - and not sure if these accounts have hundreds (or millions) of dollars. If you need paper statements and this is millions of dollars then seems to be a nuisance fee but not worth anguish over. So I would consolidate “like” accounts and then would be tempted to take my RMD (and maybe do some QCDs?) from the smallest IRA and systematically empty and shut them down.

Also not clear why do you want to continue to contribute to 401k if no heirs and now taking RMDs ? What is the goal of your savings/ tax deferral at this point ?
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Re: Request Review of Retirement Accounts Consolidation!

Post by jebmke »

retired@50 wrote: Sun Jul 07, 2024 5:12 pm For the sake of your heirs, I would recommend simplification / consolidation.

Regards,
and for the sake of self. I got dizzy scrolling OP. I used to keep data on Quicken - many, many years ago. Drove hard do consolidate. Now all I have to do is log in and go "hmmm." Still have a few remaining runts to clean up (DAF fodder) and some account rationalization on my wife's side but for the most part, it is hands off.
When you discover that you are riding a dead horse, the best strategy is to dismount.
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yankees60
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Location: Massachusetts

Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

FiveK wrote: Sun Jul 07, 2024 4:56 pm
yankees60 wrote: Sun Jul 07, 2024 1:31 pm I have been attempting for the last three year to consolidate my many retirement accounts (all Vanguard) into as few accounts as possible.
I'm now at the maximum motivation to complete this process....

...
Should all of five be consolidated?

Seems cleaner / more practical to keep them separate?
The choice is yours: consolidate into as few accounts as possible, or keep them separate.
The goal is to consolidate as much as possible, fully taking into account any tax issues or practical issues.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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yankees60
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Location: Massachusetts

Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

retired@50 wrote: Sun Jul 07, 2024 11:00 pm
yankees60 wrote: Sun Jul 07, 2024 8:29 pm
retired@50 wrote: Sun Jul 07, 2024 5:12 pm For the sake of your heirs, I would recommend simplification / consolidation.

Regards,
I have NO heirs.
Well, let me try to re-frame the question...

Who will be your executor, or who will be left to deal with the estate you leave behind?

Regards,
That is a valid concern.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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yankees60
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Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

5outof10 wrote: Mon Jul 08, 2024 9:31 am Admittedly, I couldn't read through all of what you wrote.

There are a ton of benefits in simplicity. First, I would consolidate all Roth's into one Roth. Second, I would consolidate all IRAs into one IRA. Third, I would consolidate all non-retirement accounts into one non-retirement account. Three accounts.

Then I would make sure to update the beneficiaries and the payable on death designations on these three accounts. Four if you keep a Treasury Direct account.

Setting the asset allocation would be my next priority. I would read the wiki here about that.

Best of luck.
Addressing your recommendations:

1) Yes. Hope to do as long as no one points out anything I'm missing regarding this.

2) Problem here is that the various IRAs have different tax treatments in my state (Massachusetts)

3) At this point that is already the case so no changes necessary there.

Thanks for the remaining suggestions / advice.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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yankees60
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Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

Coastfical wrote: Mon Jul 08, 2024 10:07 am It’s hard to understand exactly what you are trying to achieve - and not sure if these accounts have hundreds (or millions) of dollars. If you need paper statements and this is millions of dollars then seems to be a nuisance fee but not worth anguish over. So I would consolidate “like” accounts and then would be tempted to take my RMD (and maybe do some QCDs?) from the smallest IRA and systematically empty and shut them down.

Also not clear why do you want to continue to contribute to 401k if no heirs and now taking RMDs ? What is the goal of your savings/ tax deferral at this point ?
The accounts have a fair amount of money in them.

Good suggestion on which account to take the Required Minimum Distributions from.

I continue to contribute so that I'm in control somewhat. Moving more to Roth IRAs leaves me having to take less Required Minimum Distributions while gaining all the other benefits of a Roth IRA.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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yankees60
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Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

jebmke wrote: Mon Jul 08, 2024 10:14 am
retired@50 wrote: Sun Jul 07, 2024 5:12 pm For the sake of your heirs, I would recommend simplification / consolidation.

Regards,
and for the sake of self. I got dizzy scrolling OP. I used to keep data on Quicken - many, many years ago. Drove hard do consolidate. Now all I have to do is log in and go "hmmm." Still have a few remaining runts to clean up (DAF fodder) and some account rationalization on my wife's side but for the most part, it is hands off.
Consolidating the accounts is a necessary major first step towards the next task -- repositioning all my assets as should be appropriate for me today.

I made all my initial non-cash investments in January 2003 and have made none since. All investments since have been in cash (all now in VUSXX - Treasury Money Market fund). It's left me with about a 50 / 50 allocation.

But I'm saving that discussion until I do make my decisions and follow through on the account consolidations.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
AQ
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Re: Request Review of Retirement Accounts Consolidation!

Post by AQ »

A question about consolidation: I have multiple IRA accounts, including TIRA (with deductible contributions), TIRA (with non-deductible), Rollover IRA, Sep IRA, Roth IRA, etc. I suppose I could consolidate all of them into one TIRA, and one Roth IRA. As far as IRS is concerned, it's just one account subject to tax on withdrawal (TIRA), and one without tax (Roth IRA). So two accounts would suffice. Is this understanding correct?
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yankees60
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Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

AQ wrote: Mon Jul 08, 2024 4:17 pm A question about consolidation: I have multiple IRA accounts, including TIRA (with deductible contributions), TIRA (with non-deductible), Rollover IRA, Sep IRA, Roth IRA, etc. I suppose I could consolidate all of them into one TIRA, and one Roth IRA. As far as IRS is concerned, it's just one account subject to tax on withdrawal (TIRA), and one without tax (Roth IRA). So two accounts would suffice. Is this understanding correct?
As I have written above If you have State taxes on retirement withdrawals Then It's probably best to not combine accounts that have different state tax treatments.

I am not sure if you would want to keep the traditional IRAContribution contributions that were not deductible Separate separate from all the others. It may not make a difference. But it possibly could.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
AQ
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Re: Request Review of Retirement Accounts Consolidation!

Post by AQ »

yankees60 wrote: Mon Jul 08, 2024 4:24 pm
AQ wrote: Mon Jul 08, 2024 4:17 pm A question about consolidation: I have multiple IRA accounts, including TIRA (with deductible contributions), TIRA (with non-deductible), Rollover IRA, Sep IRA, Roth IRA, etc. I suppose I could consolidate all of them into one TIRA, and one Roth IRA. As far as IRS is concerned, it's just one account subject to tax on withdrawal (TIRA), and one without tax (Roth IRA). So two accounts would suffice. Is this understanding correct?
As I have written above If you have State taxes on retirement withdrawals Then It's probably best to not combine accounts that have different state tax treatments.

I am not sure if you would want to keep the traditional IRAContribution contributions that were not deductible Separate separate from all the others. It may not make a difference. But it possibly could.
Thanks! Learned something new.

Some quick searches seem suggesting California treats IRA contribution/distributions quite similarly. So it sounds like no reason to keep separate IRA accounts for California residents (except for Roth). Fellow Californian there? :)
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yankees60
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Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

AQ wrote: Mon Jul 08, 2024 4:45 pm
yankees60 wrote: Mon Jul 08, 2024 4:24 pm
AQ wrote: Mon Jul 08, 2024 4:17 pm A question about consolidation: I have multiple IRA accounts, including TIRA (with deductible contributions), TIRA (with non-deductible), Rollover IRA, Sep IRA, Roth IRA, etc. I suppose I could consolidate all of them into one TIRA, and one Roth IRA. As far as IRS is concerned, it's just one account subject to tax on withdrawal (TIRA), and one without tax (Roth IRA). So two accounts would suffice. Is this understanding correct?
As I have written above If you have State taxes on retirement withdrawals Then It's probably best to not combine accounts that have different state tax treatments.

I am not sure if you would want to keep the traditional IRAContribution contributions that were not deductible Separate separate from all the others. It may not make a difference. But it possibly could.
Thanks! Learned something new.

Some quick searches seem suggesting California treats IRA contribution/distributions quite similarly. So it sounds like no reason to keep separate IRA accounts for California residents (except for Roth). Fellow Californian there? :)
As I described above I am in the state of Massachusetts which does not allow any deductions for contributions to Almost all small business retirement plans.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
5outof10
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Re: Request Review of Retirement Accounts Consolidation!

Post by 5outof10 »

What happens if you move outside of MA? Would you be able to combine accounts at that time?
Checking 10K, Sinking Funds 50K (HYSA/MMF), EF 50K (I bonds), Taxable/Retirement: 72% VTI, 18% VXUS, 10% BND | I would like to own a gold bar one day, to be able to say I own a gold bar.
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yankees60
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Re: Request Review of Retirement Accounts Consolidation!

Post by yankees60 »

5outof10 wrote: Mon Jul 08, 2024 9:14 pm What happens if you move outside of MA? Would you be able to combine accounts at that time?
I can always combine the accounts. But I should only be combining accounts that make sense to combine.

If I move to a different state It would depend How much that state's tax law Agrees or does not agree with Massachusetts and if that would have an affect on my decision.
Above provided by: Vinny, who always says: "I only regret that I have but one lap to give to my cats." AND "I'm a more-is-more person."
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