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What to do with IRAs
Old 09-20-2019, 01:58 PM   #1
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What to do with IRAs

DW and I have about a half million in IRAs with USAA. USAA has sold their asset management to someone called Victory Capital. A firm I have never heard of and has made no effort to contact me about these account. Soooo.. we plan on moving two IRAs to another asset management firm.

The probability is our kids will inherit this money. We both take RMDs, and role it over to a money market. These IRAs are currently invested in USAA mutual funds and index funds. The asset allocation is, I think fairly aggressive. S&P 500, NASDAQ 100, Total Market fund, and a money market. No bonds. (cola'd pensions cover our spending at about 2 and 1/5 times. Open to a bond fund, just not sure why. DW may have one other small index fund. I balance every year to 6 months. Money market is simply to hold cash for RMD.

So, I'm looking for recommendations on where to move this money to. Ease of transfer, safety, ease of use, and anything else you all can think of I should be interested in. Now I keep our emergency in a USAA money market, however, I could also transfer the majority of that into a taxable account as long as it is readily available.

I don't trade stock. DW has a couple thousand dollars she inherited, but we other than that no individual stocks.

So, looking for advice.
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Old 09-20-2019, 02:07 PM   #2
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We have several accounts, including 2 Roth IRAs with Fidelity. We also have an account with Schwab. Both are good. Fidelity is advertising on TV lately about earning MMF rates on "cash" vs. the lower rates elsewhere, which is quite true. Keep that in mind.

As far as ease of use, both Fidelity and Schwab are easy to use, and it's easy to research investment options. Both have NTF mutual funds and commission-free ETFs.
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Old 09-20-2019, 02:11 PM   #3
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I'd move it to one of Schwab, Fidelity, TD Ameritrade, or Vanguard, and manage it myself. Maybe pick one that has an office near you, or whichever you think you feel most comfortable with. Or where you have any taxable accounts now. All should be able to assist you with the transfer easily. If you aren't getting good help, move on to the next.

What to invest in should be considered in conjunction with all of your other assets. Think of all of your accounts as one big pool, and decide what % of stock funds (or individual stocks, but no need to do this), bond funds or individual bonds, and cash (CDs, money markets, treasuries). Then allocate the funds using https://www.bogleheads.org/wiki/Tax-...fund_placement as a guide.
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Old 09-20-2019, 02:25 PM   #4
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With your pensions way more than covering your expenses, I'd be aggressive with investments as you are. I'm presuming these pensions are safe/well funded.

Sounds like the money markets are building up and represent a % of your investments relative to the IRAs. If that's the case, beyond some cash reserve, I'd be shifting to stocks outside the IRAs and bonds inside by a comparable amount staying just as aggressive. Cap gains/dividends created inside IRAs get taxed as ordinary income when they come out as RMD whereas outside IRA they are taxed at 0% to $77K income & 15% to $400K for joint filers. Also, cap gains go away to whomever inherits your non-IRA assets due to step up.
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Old 09-20-2019, 02:26 PM   #5
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Originally Posted by RunningBum View Post

What to invest in should be considered in conjunction with all of your other assets. Think of all of your accounts as one big pool, and decide what % of stock funds (or individual stocks, but no need to do this), bond funds or individual bonds, and cash (CDs, money markets, treasuries). Then allocate the funds using https://www.bogleheads.org/wiki/Tax-...fund_placement as a guide.
This true & what I was implying.
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Old 09-20-2019, 02:29 PM   #6
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I'm at Fidelity and TD Ameritrade, plus I've been working with someone who's on ETrade. So I've got experience with all three platforms and customer service. Fidelity is the best of these three for the factors you are looking at.
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Old 09-20-2019, 02:32 PM   #7
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I'd move it to one of Schwab, Fidelity, TD Ameritrade, or Vanguard, and manage it myself. Maybe pick one that has an office near you, or whichever you think you feel most comfortable with. Or where you have any taxable accounts now. All should be able to assist you with the transfer easily. If you aren't getting good help, move on to the next.

What to invest in should be considered in conjunction with all of your other assets. Think of all of your accounts as one big pool, and decide what % of stock funds (or individual stocks, but no need to do this), bond funds or individual bonds, and cash (CDs, money markets, treasuries). Then allocate the funds using https://www.bogleheads.org/wiki/Tax-...fund_placement as a guide.
Exactly what I would say.
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Old 09-20-2019, 02:38 PM   #8
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I agree that Schwab or Fidelity would be great choices.

A couple years ago, I helped my in-laws transfer their accounts from Merrill Lynch to Fidelity. It could not have been simpler. We first opened all the accounts online at fidelity.com (two IRAs, one joint brokerage, one CMA). Then, to fund the accounts, we specified "asset transfer" from the corresponding ML accounts. All the assets transferred in-kind about a week later. No selling/buying. No waiting for checks. No tax implications. Very smooth. They got some sign-up bonuses as well, including 300 free trades.

They also set me up as an "agent" on their accounts. So once everything was over to Fidelity, I sold most of the high-ER mutual funds that Merrill had them in, and bought widely-held, low-cost index funds, like VTI and AGG. I also set them up on Fidelity's automatic RMD process.

I'm reasonably sure the process with Schwab would be equally smooth. My only advice would be to initiate everything from the receiving financial institution. If you're not comfortable doing all this online, Fidelity has brick-n-mortar Investor Centers where you can let an actual human help with the process. Their phone support is really good as well.
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Old 09-20-2019, 03:02 PM   #9
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I'm reasonably sure the process with Schwab would be equally smooth. My only advice would be to initiate everything from the receiving financial institution. If you're not comfortable doing all this online, Fidelity has brick-n-mortar Investor Centers where you can let an actual human help with the process. Their phone support is really good as well.
As does Schwab and TD Ameritrade. In fact, all 3 have offices within a mile of each other near the same intersection about 30 minutes away from me. That might help OP to decide, unless the same situation exists in their area.
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Old 09-21-2019, 06:53 AM   #10
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Originally Posted by Rustic23 View Post
DW and I have about a half million in IRAs with USAA. USAA has sold their asset management to someone called Victory Capital. A firm I have never heard of and has made no effort to contact me about these account. Soooo.. we plan on moving two IRAs to another asset management firm.

The probability is our kids will inherit this money. We both take RMDs, and role it over to a money market. These IRAs are currently invested in USAA mutual funds and index funds. The asset allocation is, I think fairly aggressive. S&P 500, NASDAQ 100, Total Market fund, and a money market. No bonds. (cola'd pensions cover our spending at about 2 and 1/5 times. Open to a bond fund, just not sure why. DW may have one other small index fund. I balance every year to 6 months. Money market is simply to hold cash for RMD.

So, I'm looking for recommendations on where to move this money to. Ease of transfer, safety, ease of use, and anything else you all can think of I should be interested in. Now I keep our emergency in a USAA money market, however, I could also transfer the majority of that into a taxable account as long as it is readily available.

I don't trade stock. DW has a couple thousand dollars she inherited, but we other than that no individual stocks.

So, looking for advice.
Sounds like you want a combination of good service and a good web site.

Fidelity fits that bill.
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Old 09-21-2019, 08:56 AM   #11
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I agree that Schwab or Fidelity would be great choices. ...
Yes. We are happy at Schwab but Fido gets very good reports around here as well. Transfers, ease of use, etc. are going be similar or identical.

Given the minor differences between the two houses, choosing a rep is probably more important than choosing a house.

@Rustic23, I would suggest making a list of things that you would like to see in a rep, especially considering that this rep may also end up helping your children. Sex? Experience in the market (I suggest minimum 15 years, to cover the 2008 excitement)? Investing interests? Investing style?

Then contact the branch managers at both houses, describe to them your financial situation and discuss your preferences in a rep. Ask to interview at least two reps at each place. Do all this face-to-face even if it involves some driving. Distance to the office can be a selection criterion later, but for example my Schwab rep is maybe 5 miles away and I don't see him even once a year. YMMV, though.

Selecting the right rep may not be a permanent thing since these folks move around between and inside organizations but it is a good start. I think we have had our rep for at least ten years. Maybe longer.
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Old 09-21-2019, 09:09 AM   #12
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Move it to one of the big 3.

I'm moving everything to Fidelity since the offerings are decent & there's a local office.
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Old 09-21-2019, 09:20 AM   #13
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I moved my stuff from USAA to FIDO and have never looked back. Still hold a USAA fund in FIDO but I'm not willing to lock in the losses by selling.
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Old 09-21-2019, 09:31 AM   #14
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Although I have a Vanguard IRA, I will probably be moving it as I like the idea of a bricks and mortar store even though TD and FIDO are now 1.5 hour drive since the move. My new TD advisor is a CFP and we just met a week ago. He had some useful tips regarding my IRAs and RMDs that I will be dealing with in a couple of years. For example, my RMDs will be significantly lower because my spousal beneficiary is 16 years my junior. I didn't realize that made a difference.
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Old 09-21-2019, 09:34 AM   #15
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Rustic, Vanguard or Fidelity would be my recommendation. We recently moved DW's IRA two accounts and my small Roth from USAA (Victory Capital) to Vanguard for the same reasons you gave for your move. Took about three weeks to get it done, a bit longer than I thought was necessary, maybe due to the fact the USAA/Victory Capital folks weren't up to speed yet on how to facilitate the transfer. (Or maybe they had so many requests they were backed up. )

Other that the time factor, the transfer to Vanguard went off without a hitch.
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