Transfer Fees?

[jaerco]

I have been searching the internet all day and haven't quite found an answer so I thought I would ask here.

I started with Merrill Lynch in 07/04 and have 92K in there "aggressive" mutual fund plan with ML and Pioneer funds for my Pretax(401k) as I am self employed.  I am looking to start more after tax funds and finally starting to learn about the fees charged by mutual funds(sales load/expense ratio/etc) and Merrill Lynch ("management fees").  I am looking to transfer my pretax 92,000 to a few Vanguard funds and continue adding about 44k/year. Are there fees to transfer to the new funds?  I remember that when I left my last job I was able to "role over" into my new accounts without any fees?  Does that still hold true? 

Thanks in advance for any advice.

jaerco

 

[Brat]

Do you want to change custodians, or do you want to sell fund(s) and invest the proceeds in another fund?

Some custodians will charge a transfer fee; some funds have a 12(b)(1) fee, others charge a fee if you sell within a specific time frame. You don't need to sell a fund when you change custodians.

 

[uncledrz]

Check on the ML website to see if you have any backload fees (sale fees) for the funds. Then check to see what the transfer fee is, most do charge such a fee, somewhere around $25-50.
I don't think you should run into any other fees, but do suggest that you research this out on the ML site.

 

[jaerco]

Do I need to "sell" them and then "buy" the new vanguard funds? I think they have a 1% backend load fee. I wasn't sure if I could take the money and roll it straight into the new funds directly so I didn't have to worry about tax/penalities. That is what I did when I left my last job. I just filled out the forms and the money went directly to ML into the new funds. I'll search through the web site some more. I need to gather some information before I start letting my "financial advisor" know what is going on.

 

[73ss454]

You would have to open a brokerage account with Vanguard. Then just fill out the forms and transfer the account to Vanguard without selling anything. At that point you can decide what to do.

 

[LOL!]

Who was it on these threads that just cleared out of ML and went to Vanguard?  Let me look ... it was smooch
http://early-retirement.org/forums/index.php?topic=5400.0 is one such thread about fees.  I believe there is another one as well.  Maybe send her a private message if she is still around?

I wonder if you could put all your ML assets into their money market fund? Then there is only one fund to mess with on the transfer.

 

[smooch]

I am still around, reading everything every night! ML charges $75 to close an account. The "extra fees" at Vanguard turned out to be non-existent. I have several funds with back end loads, which I will wait to move until the load no longer applies. I am selling my ML funds because the expense ratios are over 1% higher than similar funds at Vanguard, although my ML financial advisor maintains that fees don't matter if the funds are doing well.

 

[jaerco]

Thanks everyone for the info. I didn't think it would be that hard, but getting to a specific bit of info on the other websites can be a bit tough. I have to read up more on the backend loads that are associated with the ML funds. My advisor(is my best friends brother) and it wasn't until I was looking to start the after-tax investing in mutual funds that I found out about his "1.25%" management fee. Thats when I started doing th research, went and bought "The Four Pillars," and now learning to understand all of these fees. I am a pretty dedicated saver with plenty of free time now. I think I can afford to do a little research and invest in other funds and save a few percentage points. It'll be tough to explain that to my friend's brother though. Better late than never.

jaerco

 

[73ss454]

Thanks everyone for the info.  I didn't think it would be that hard, but getting to a specific bit of info on the other websites can be a bit tough.  I have to read up more on the backend  loads that are associated with the ML funds.  My advisor(is my best friends brother) and it wasn't until I was looking to start the after-tax investing in mutual funds that I found out about his "1.25%" management fee.  Thats when I started doing th research, went and bought "The Four Pillars," and now learning to understand all of these fees.  I am a pretty dedicated saver with plenty of free time now.  I think I can afford to do a little research and invest in other funds and save a few percentage points.  It'll be tough to explain that to my friend's brother though.  Better late than never.

jaerco

I felt the same way as you did about leaving the guy I invested with for 20 years. The more I thought about it the more upset I got. But not about leaving but about how I had been ripped off for so long. At the end of Dec I sold all my stocks with AG Edwards and Merrill and sent the cash to Vanguard. Then after the 1st of the year I called my long term broker at AG Edwards and gave him the news. As of now I'm waiting for all the monies to be sent to Vanguard. In another week or two we'll have everything under one roof. I didn't sell any of the loaded funds, I just sent the account to Vanguard as is and will make the proper adjustments as I go. I might have to pay some tax on the taxable accounts but in the long run DW and I will be better off.
Thanks to all the folks on this board who helped me get to this point.

It won't be tough to explain to your broker why your leaving. He know's the math better than you, and he's probably with Vanguard himself.

Good Luck

 

[cute fuzzy bunny]

I think I can simplify this. Anyone that wants to charge you nothing or nominal fees to get in should be considered strongly for a long term relationship. Anyone that wants to line people up to take a crap in your hat on the way out should be added to the 'never again' list of investment partners.

Live and learn, and learn from y'er learnin's...

Shoot, is it getting close to 'national talk like a pirate day', i'm a gittin' a little sick of international talk like a redneck week...again...

 

[wallygator69]

Hi Folks newbie here,

I am with LPL Financial and have a ton of class b shares in the likes of American Funds, Openheimer etc. Been there for about 4 years (couldn't look anymore after the Bubble Burst) and just gave them what was left. Yes, he explained B shares to me very well and honestly. Just didn't care at the time...

You have opened my eyes. Can I transfer the entire account to Vanguard prior to my B shares becoming A share (think it is 5 years)?

Do you think I'd get hit with fees.

Not sure how to break it to my FA. Veyr nice family guy, I feel bad but what can you do..

Thanks to all been lurking for weeks now...

Wally

 

[73ss454]

Welcome Wally,

I'm in the process of moving my accounts over from AG edwards. You would have to open a brokerage account with Vanguard and fiill out the proper paper work. It takes a while for the money to be moved but you can keep your money in the investments that they are in now. If you put more than $250K with Vanguard they have a free service that will assist you with different allocations.

If you feel bab about leaving your long time broker as I did, do the following.
Take a look at the fees you paid and the expense ratios with funds such as Oppenheimer. After the pain in your stomach goes away call the broker and give him the good news. It will actually make you feel great.

Good luck,
Joe

 

[wallygator69]

Thanks 73ss454,

What are you planning to do with the Funds when you get them there. I have 5 figure capital gains in a dozen American/Openheimer stock funds that have performed nicely. Are you considering paying the cap gains or sticking with them for a while?

Also have a half dozen bond funds that have negligible or slight loss in them. With Fixed income rates up to the 4% area thinking this money may be better there. But unfortunately all B Shares also.

About 2 years (maybe months if my job goes away) from Retirement.

Thanks again

Wally

 

[73ss454]

Thanks 73ss454,

What are you planning to do with the Funds when you get them there.  I have 5 figure capital gains in a dozen American/Openheimer stock funds that have performed nicely. Are you considering paying the cap gains or sticking with them for a while?

Also have a half dozen bond funds that have negligible or slight loss in them.  With Fixed income rates up to the 4% area thinking this money may be better there. But unfortunately all B Shares also.

About 2 years (maybe months if my job goes away) from Retirement.

Thanks again

Wally

Some of the monies are in IRA's, SEP, and a taxable account.  The IRA's and SEP I will put into various Vanguard funds.  With the taxable account I will have to do some accounting and see what is best.  I may wait until next year after I stop working, then I will be in a lower tax bracket.  I actually feel better that Vanguard is getting the extra costs from the Oppenheimer rather that my "X" broker.