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Transferring money to another fund family
Old 09-18-2014, 06:27 PM   #1
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Transferring money to another fund family

Is it possible to set up a direct transfer of funds between one of the funds in a mutual fund family and the money market fund of another fund family? Specifically, is it possible to set it up on-line where I can move and transfer money from my Vanguard MM fund to and from a fund in another fund family? At first, I thought this cannot be done, but wouldn't this be like just a bank transfer?
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Old 09-18-2014, 06:41 PM   #2
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Yes, it is possible as long as the "another fund family" allows it.

For example, I transferred from TDAmeritrade to Fidelity by using software tools on the Fidelity web site. I did a "partial transfer" of assets. I don't think that this is exactly what you meant though.

I have also transferred from my account at one broker to my child's account at another broker.

A MM fund is NOT the same as a checking or savings account, so an ACH transfer is not going to work.
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Old 09-18-2014, 06:57 PM   #3
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Transferring quickly between tax-deferred accounts wouldn't work, of course, but I'm sure there's a way to optimize transfers like this between taxable accounts.

I'm curious why you are contemplating such a strategy, however. No matter where the money is held, with the simple establishment of a brokerage account at your "home" fund family, you can buy low-fee ETFs from a variety of providers at less than $10 per transaction. Most of those brokerages and fund families also offer a selection of funds from other providers at a relatively low extra cost.

One example: I currently have $10,000 in a Fidelity money market mutual fund held in a mutual fund acount, but I really like the Vanguard Total Stock Market mutual fund. With a form, I ask Fidelity to set up a brokerage account and transfer $5000 to the new account. The funds probably appear the next day, and certainly there is no transfer fee. I then put in an order for buying $5000 worth of VTI, Vanguard's exchange-traded sister of the Total Stock Market Fund. The commission will be $7.95, and I'll still have all of the funds show up on one screen.
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Old 09-19-2014, 07:08 AM   #4
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Quote:
Originally Posted by Htown Harry View Post
Transferring quickly between tax-deferred accounts wouldn't work, of course, but I'm sure there's a way to optimize transfers like this between taxable accounts.

I'm curious why you are contemplating such a strategy, however. No matter where the money is held, with the simple establishment of a brokerage account at your "home" fund family, you can buy low-fee ETFs from a variety of providers at less than $10 per transaction. Most of those brokerages and fund families also offer a selection of funds from other providers at a relatively low extra cost.

.
Thanks for your reply. I'm just in a situation now where I already own funds from several families and am looking for an easier way to move money around when necessary. I bought most of these funds before the internet, so the options for redeeming were to have a check mailed to me or a money transfer to a bank. If I had to do it over again, I'd go the ETF route with my home fund family (like you mention) to simplify paperwork. There's no way I can convert the ownership of an existing fund to an ETF without incurring capital gains or losses is there? I know there are several work-arounds I can do and actually this is a nice problem to have in a way.
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Old 09-19-2014, 07:09 AM   #5
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Yes, it is possible as long as the "another fund family" allows it.
Thanks. I will look into this.
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Old 09-19-2014, 08:47 AM   #6
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You should be able to set up a recurring "ACH" transaction. This is the banking system that handles paper and electronic checks. Usually there is no charge, but it can take up to 5 business days.

I don't think that the receiving fund family could refuse it. I mean, when would a fund family NOT want money to come in? Obviously if the deposit-to account was not specified, it would be rejected on the technicality, but once that is correct, the money would be accepted into your account. The two accounts should be titled identically (in other words, not going from person A to person B).
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Old 09-19-2014, 08:52 AM   #7
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Would it work to set up a Vanguard brokerage account and have your other mutual fund shares transferred "in-kind" to the Vanguard brokerage account? Then you could buy more shares with the money in your Vanguard MM (assuming the mutual fund you have is on VBS' list).

Technically, you are buying the mutual fund shares and then on settlement selling Vanguard MM shares to settle the trade.
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Old 09-20-2014, 05:04 PM   #8
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You should be able to set up a recurring "ACH" transaction. This is the banking system that handles paper and electronic checks. Usually there is no charge, but it can take up to 5 business days.

I don't think that the receiving fund family could refuse it. I mean, when would a fund family NOT want money to come in? Obviously if the deposit-to account was not specified, it would be rejected on the technicality, but once that is correct, the money would be accepted into your account. The two accounts should be titled identically (in other words, not going from person A to person B).
I use ACH/EFT all the time between accounts at different fund families. I use my main brokerage's cash management account as the central account and then EFT to or from that account to the various fund accounts. Very easy, not too hard to set up, and about as quick as you can do it. Any account that you can easily write checks from should do.
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