Fidelity as a one stop shop

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InvisibleAerobar
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Re: Actionable PSA: push funds into Fidelity to avoid 3-week hold periods, in particular for backdoor Roth

Post by InvisibleAerobar »

mhc wrote: Wed Jan 15, 2025 9:31 am
InvisibleAerobar wrote: Tue Jan 14, 2025 8:23 pm Now I'll have to read up on how to deal with the ~$16 earned in interest, which is not only taxable but also requires a bit more processing on the 8606 form.
This is no big deal if you use tax software. It is no extra work. It is not unusual for someone to pick up a dollar or so before the Roth conversion occurs. I have done this many times, and I do not recall that it takes any extra work.
Downside is that HR Block (the software I used in the past) couldnt 1) properly do accrued market discounts on Treasuries and in general had a horrid time handling the tax documents from my brokerage account and 2) didn’t allow me to properly input tax due on HSA overcontribution.

Issue 2) is (hopefully) an one-time thing, but issue 1) makes me doubt as to whether the same software could properly manage Form 8606.

Good thing is that i don’t have to deal with it until Feb. 2026, but i don’t have high hopes that Turbo Tax would be drastically better than HR Block.

volstagg wrote: Wed Jan 15, 2025 10:33 am
mhc wrote: Wed Jan 15, 2025 9:31 am

This is no big deal if you use tax software. It is no extra work. It is not unusual for someone to pick up a dollar or so before the Roth conversion occurs. I have done this many times, and I do not recall that it takes any extra work.
Totally, you'll get a 1099-R from Fidelity, put the numbers into the tax software regardless of if the rollover was $7000 or $7016, the tax software will deal with form 8606. Only net impact is going to be you're going to pay taxes on that $16 for the rollover.

Next year, push the funds into your CMA or Brokerage account directly, then you can do the tIRA contribution and rollover same or next business day without the hold.
Just to clarify, for simplicity, I should just convert the entirety of $7016 all in one go in 2025, correct?

I was reading up on WhiteCoat Investor’s blog specifically on the issue of additional dollar (or more) accrued btwn contribution and conversion, and right at the end, despite what appears to be otherwise endorsement for complete conversion, he also mentioned converting the excess amount next year (in my case that would be $16 and interest earned on that $16). My very layperson’s reading is that this represents a “could do” but not a “should do”, as I would assume doing so gets one mired into pro-rata calculations at a future time.
volstagg
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Re: Actionable PSA: push funds into Fidelity to avoid 3-week hold periods, in particular for backdoor Roth

Post by volstagg »

InvisibleAerobar wrote: Wed Jan 15, 2025 11:32 am Just to clarify, for simplicity, I should just convert the entirety of $7016 all in one go in 2025, correct?

I was reading up on WhiteCoat Investor’s blog specifically on the issue of additional dollar (or more) accrued btwn contribution and conversion, and right at the end, despite what appears to be otherwise endorsement for complete conversion, he also mentioned converting the excess amount next year (in my case that would be $16 and interest earned on that $16). My very layperson’s reading is that this represents a “could do” but not a “should do”, as I would assume doing so gets one mired into pro-rata calculations at a future time.
Doesn't really matter. If it were me, I'd convert the $7000 as soon as Fidelity let me have it so I could get it invested, then on Feb 1, after SPAXX pays out I'd convert the residual interest (or maybe the residual interest minus $0.01 to keep the tIRA open for next year). Whether you convert in 1 step, 2 steps or 10 steps, you'll only get 1 1099R from Fidelity for the tIRA account to enter into your tax software next year.

ETA, the only reason I could see not converting the residual $16 in 2025 is, if that extra $16 pushed you over some tax cliff (ACA subsidy or similar), otherwise, there is nothing magical about that $16, it's just a conversion from a tIRA to a Roth IRA, something lots (millions?) of people do every year. That $16 will get added to your taxable income (like all your other income) when you file in spring 2026.
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mhc
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Re: Fidelity as a one stop shop

Post by mhc »

Normally, you want your IRA to be at $0 ($0.01 rounds to $0 on the tax forms) at the end of the year. I think this makes everything simpler.

Convert everything from your IRA to your Roth.
52% TSM, 23% TISM, 24.5% TBM, 0.5% cash
bbrock
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Re: Fidelity as a one stop shop

Post by bbrock »

tj wrote: Sat Jan 11, 2025 5:27 pm
bbrock wrote: Sat Jan 11, 2025 3:23 pm

Got it. I’ll have to look at the activity page.

I click on one of the transactions on the activity page for my CMA that shows an Electronic Funds Transfer, but this was in last 30 days. Maybe because the transactions already settled perhaps that’s why it doesn’t show if there had been a hold?

I’ll just try this one of these weeks just to see what happens with a pull from Ally.
it shows you when it expires when you have one.

There's obviously no reason to show you a hold if it's no longer relevant.

It sounds like you have no reason to even worry about them if you have to ask.
Looks like we are affected.

I looked at a pull we had recently completed in my DW's CMA. Credited at Fido on 1/9. Funds won't be cleared until 2/1. Ouch! Even though we don't need to promptly access the funds that are pulled to Fido, since viewing this, I have started pushing from Ally.
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bling
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Re: Fidelity as a one stop shop

Post by bling »

FWIW it's seems their policies still vary for different accounts. i pulled into DW's traditional on a wednesday. they held for thursday. friday we were able to transfer to the Roth and complete the backdoor.
exarkun
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Re: Fidelity as a one stop shop

Post by exarkun »

Is ebill autopay for US bank credit cards an option in fidelity bill pay?
volstagg
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Re: Fidelity as a one stop shop

Post by volstagg »

exarkun wrote: Sat Jan 25, 2025 10:00 am Is ebill autopay for US bank credit cards an option in fidelity bill pay?
It's not for the Fidelity ELAN, which is owned/managed by US Bank, so I doubt it is for general US Bank cards.
kojima
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Re: Fidelity as a one stop shop

Post by kojima »

Would a Fidelity transfer from a brokerage account to an external bank account not be processed in the following situation?

1. Turn off Money Transfer Lockdown
2. Attempt to transfer settled cash from Fidelity brokerage account to external bank account on Sunday
3. After the transfer request is put in, immediately turn back on the Money Transfer Lockdown

Since the transfer will happen on a business day when the Money Transfer Lockdown is enabled, will this transfer be properly processed?
chassis
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Re: Fidelity as a one stop shop

Post by chassis »

kojima wrote: Sun Feb 02, 2025 3:38 pm Would a Fidelity transfer from a brokerage account to an external bank account not be processed in the following situation?

1. Turn off Money Transfer Lockdown
2. Attempt to transfer settled cash from Fidelity brokerage account to external bank account on Sunday
3. After the transfer request is put in, immediately turn back on the Money Transfer Lockdown

Since the transfer will happen on a business day when the Money Transfer Lockdown is enabled, will this transfer be properly processed?
It should work as you have written it. The question is when/how fast. ACH takes a few days. Bank wire is same day if the transaction is initiated before 4:00pm New York time.
Lyrrad
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Re: Fidelity as a one stop shop

Post by Lyrrad »

chassis wrote: Sun Feb 02, 2025 3:58 pm It should work as you have written it. The question is when/how fast. ACH takes a few days. Bank wire is same day if the transaction is initiated before 4:00pm New York time.
Fidelity uses same-day ACH in many cases, so funds are often received the same business day if it is initiated before certain times.

This Reddit post suggests that an outgoing ACH transfer from Fidelity initiated between 8AM and 12PM ET will arrive before 5PM ET if sent via same-day ACH.

I use wires when the other account doesn't charge a fee and that usually take an hour if sent before the cutoff.
volstagg
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Re: Fidelity as a one stop shop

Post by volstagg »

Lyrrad wrote: Sun Feb 02, 2025 4:26 pm Fidelity uses same-day ACH in many cases, so funds are often received the same business day if it is initiated before certain times.
I can confirm, the banks I currently use, if I push from Fidelity in the morning (before 9am Eastern, haven't tried much later then that), funds always show in my account sometime that same day between 2pm and 4pm (depending on the bank). Not every bank will honor same day ACH, but it seems more and more of them do.
lstone19
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Re: Fidelity as a one stop shop

Post by lstone19 »

This site, https://www.frbservices.org/resources/r ... edule.html, should be useful in understanding how ACH transactions work and the processing schedule.
glitchy
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Re: Fidelity as a one stop shop

Post by glitchy »

lstone19 wrote: Mon Feb 03, 2025 1:49 pm This site, https://www.frbservices.org/resources/r ... edule.html, should be useful in understanding how ACH transactions work and the processing schedule.
EPN also handles a bunch of them and has a somewhat different schedule: https://www.theclearinghouse.org/paymen ... g-Schedule

The EPN schedule also has more detail on timing for inter-operator flow. Either way, being before 10:25am ET is a good target time for same-day.
acegolfer
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Re: Fidelity as a one stop shop

Post by acegolfer »

Sorry this may have been asked.

I read some months ago that CMA can now use MMF as the settlement fund. If true, is there any reason why one would open the regular account (no reimbursement ATM fee)?

Isn't CMA superior?
Lastrun
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Re: Fidelity as a one stop shop

Post by Lastrun »

acegolfer wrote: Mon Feb 03, 2025 6:00 pm Sorry this may have been asked.

I read some months ago that CMA can now use MMF as the settlement fund. If true, is there any reason why one would open the regular account (no reimbursement ATM fee)?

Isn't CMA superior?
CMA is not necessarily superior

While the CMA does have (1) ATM reimbursements at any asset level, and (2) the Cash Manager, which people find useful----the CMA lacks (1) the ability to use margin, and (2) the ability to trade options.

And yes, having SPAXX as the sweep was a very nice change and I think a tag team CMA and Brokerage combo at Fidelity works great.
acegolfer
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Re: Fidelity as a one stop shop

Post by acegolfer »

Lastrun wrote: Mon Feb 03, 2025 6:11 pm
acegolfer wrote: Mon Feb 03, 2025 6:00 pm Sorry this may have been asked.

I read some months ago that CMA can now use MMF as the settlement fund. If true, is there any reason why one would open the regular account (no reimbursement ATM fee)?

Isn't CMA superior?
CMA is not necessarily superior

While the CMA does have (1) ATM reimbursements at any asset level, and (2) the Cash Manager, which people find useful----the CMA lacks (1) the ability to use margin, and (2) the ability to trade options.

And yes, having SPAXX as the sweep was a very nice change and I think a tag team CMA and Brokerage combo at Fidelity works great.
Thanks. I agree CMA + brokerage is a nice combo.

But many ppl prefer just 1 account. CMA sounds better, if no margin, no option trading.
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anon_investor
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Re: Fidelity as a one stop shop

Post by anon_investor »

Just got my new CMA debit card (Leader Bank issued one), the card # was the same as the PNC one but had different expiration/security does. After activated, the debit card was locked (my PNC one was locked).
chassis
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Re: Fidelity as a one stop shop

Post by chassis »

I recently changed from CMA + brokerage to CMA alone. It's a nice simplification with no loss of functionality for me. I don't trade options or use margin, although I could have done both in my former brokerage account.

If my needs change in the future, opening a new brokerage account is simple enough.
michaeljc70
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Re: Fidelity as a one stop shop

Post by michaeljc70 »

Though any financial institution can make a mistake and I was happy with Fidelity until this point, I might be changing my mind. Long story short...I only have a Fidelity debit card as "one stop shop" implies. I am in a foreign country going to a remote part of said foreign country. My debit card doesn't work. I need cash to even get to this remote place (and thought I might have had enough until today).

Yes, I shouldn't have waited until the last minute but my Fidelity card always worked before. The app just crashed 8 times trying to unlock the card. Their website was showing the NEW debit card I do not have yet (to those that don't know they are transitioning). I called Fidelity thinking my card was locked. She assured me it wasn't. I went to an ATM, denied 2x. My friend's card worked at the same ATM. I called again. She told me there are tons of issues with the new cards (which I don't have yet) and that is why it isn't working and basically tough luck. What she said didn't make sense (when it was denied it deactivated the old card....but they denied it). She was nice and frustrated because I am sure they've gotten a lot of calls.

Luckily I was able to borrow money from my friend. :oops:
InvisibleAerobar
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Re: Fidelity as a one stop shop

Post by InvisibleAerobar »

InvisibleAerobar wrote: Tue Jan 14, 2025 8:23 pm [Thread merged into here --admin LadyGeek]

There's little rhyme or reason why Fidelity has implemented an insanely-long hold for pull transfers, but the fact is that it has, and at least another forumite has been on the receiving end of it.

I'm not as familiar with the way Fidelity works, and this hasn't really been an issue when contributing to regular Roth (directly via payroll ACH), but it's the first time for us doing backdoor Roth with a lump sum deposited in January. It was suggested that I use the contribute option on Fidelity, which in effect is an ACH pull (as opposed to push).

Pull for funds initiated on Monday 13 Jan. 2025;
Funds in tIRA account on Tuesday 14 Jan. 2025;
It'll take until Wednesday 5 Feb. 2025 for Fidelity to allow the funds to fully settle, before it could be converted into a Roth IRA account.

Absolute madness...

Now I'll have to read up on how to deal with the ~$16 earned in interest, which is not only taxable but also requires a bit more processing on the 8606 form.
16 business days later, the Fidelity finally allows the Roth Conversion. What a shoddy experience...

At least they didn't further delay things...
GoodOmens
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Re: Fidelity as a one stop shop

Post by GoodOmens »

Just opened an account and was able to ACAT over FSIXX from Merrill. ME already shows it clawed back but was able to purchase additional shares today in Fidelity before its shown as clawed back on the Fidelity side.
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anon_investor
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Re: Fidelity as a one stop shop

Post by anon_investor »

GoodOmens wrote: Thu Feb 06, 2025 10:35 am Just opened an account and was able to ACAT over FSIXX from Merrill. ME already shows it clawed back but was able to purchase additional shares today in Fidelity before its shown as clawed back on the Fidelity side.
Same thing happened to me last year. Enjoy FSIXX! :sharebeer

I was also able to transfer FSIXX in-kind to my other Fido accounts too (e.g. from my CMA to brokerage).
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