IRA Rollover Question...

craigster59 · craigster59's Garage

A friend is rolling money from an existing IRA account into a new account. Is there anything they should look for in opening the new account (Bank vs, Credit union, Charles Schwab, Fidelity, etc) Is one better than the other? Just looking for some general info fom the Pelican Brain Trust. Thanks in advance!

Hugh R · 01-08-2012, 10:30 AM

I'd look at the fees that they charge initially and annually. In some years they make more in fees than your account grows.

Tobra · Tobra's Garage

He also wants to do a direct transfer from one account to the other or he will pay taxes on it. The two accounts have to be the same, by this I mean both Roth or standard IRA accounts.

craigster59 · craigster59's Garage

He wants to roll it directly to avoid the taxes, just didn't know if anyone knew of an institution that had the lowest fees. Everyone wants you to come in and discuss which wastes a lot of time. I was thinking a credit union might have lower fees as opposed to Chase or a larger institution.

KFC911 · 12:30 PM

My last 401k was with Fidelity, and having been very pleased over many years, I decided to "roll" my other IRAs. etc. "under the same roof". Fees are EXTREMELY reasonable imo, and I did not want to "consolidate accounts" (for future IRS considerations)...just wanted to have them all in one place. Set up an IRA with whomever you choose, and let them "transfer/pull" your funds from the old IRA...very easy to do.

ps: I spent a career with two of the mega-banks some time back...I wouldn't go near them, but that's just me

pps: I've never personally met with anyone...initiated it and handled it all online. It might be different if you don't already have a 401k., etc. but that's my .00002 cents

widgeon13 · 01-08-2012, 12:55 PM

I have found Fidelity very competitive.

74-911 · 01-08-2012, 01:24 PM

I would definitely take a look at Vanguard. I rolled two different IRAs into Vanguard.. very easy to do and their expense ratios are extremely low.

pwd72s · 01-08-2012, 04:47 PM

Quote:

Originally Posted by craigster59

He wants to roll it directly to avoid the taxes, just didn't know if anyone knew of an institution that had the lowest fees. Everyone wants you to come in and discuss which wastes a lot of time. I was thinking a credit union might have lower fees as opposed to Chase or a larger institution.

Low fees? That usually means Vanguard to me...

KFC911 · 05:29 PM

Just to clarify (in case there is confusion)....I don't do equity funds anymore as I am very "hands on", but the OP is talking about the custodian of his friend's IRA. I'm sure Vanguard is just fine, but I think a Fidelity IRA can buy Vanguard funds (my Fidelity 401K can), and I think a Vanguard IRA could purchase Fidelity funds if one desired. BTW, I do have a couple of Fidelity bond funds...both were near the expense ratio of their Vanguard counterparts. I've owned Vanguard funds in the past, but have no clue about their online "interface" and how it's user presentation looks. I really do like Fidelity's Brokerage account in that regard. Wouldn't go wrong with either imo...just a personal preference thing.

ps: My annual expense ratio is extremely small...it's as if it doesn't exist, which is absolutely a good thing and something to be VERY cognizant about.

VincentVega · 01-08-2012, 05:57 PM

As above this should be a simple procedure. I would focus on what you want to with the $$ as much as what the fees are. If you only want a temp holding spot, just about any of the big guys have free or practically free IRA transfers.

T Rowe Price, Etrade, Vanguard... I've rolled into each and done everything online with no intervention. Only Fidelity gave me some hassle, they wanted $$ to transfer FROM their account.

It's hard to beat Vanguard fee's if they have what you want to buy. Their zero cost in house ETF's are nice too.