About how long does a Roth conversion take with Fidelity?

[O2Bfree]

I'll be doing my first Roth conversion this year, partly to make sure I stay above the Medicaid threshold for ACA tax credits. I'm converting online across my Fidelity accounts from a TIRA to an existing Roth IRA.

Can anyone who's done this with Fidelity tell me about how long it'll take to complete the conversion? I'm thinking it'd go within a few days, and I could wait until a little closer to the end of the year if I wanted to. But of course I don't want to be surprised with a long transfer time and miss the EOY deadline.

[ILikeStarTrek]

I can't promise it will always be this way, but last year I converted from a Traditional 401k (whose plan is in Fidelity) to an existing Fidelity Roth IRA. I did it on Dec 31, and the funds went out that day. The funds didn't show up in the new account until Jan 1 or 2 (I don't recall if Jan 1 is a stock-market holiday, but it was the first day the markets were open). My accountant said that since the funds went out of the old account on Dec 31 then I could still put the conversion in the 2019 tax year. If I were doing it again I wouldn't wait until Dec 31, but even Dec 30 is probably adequate.

You can/should also call Fidelity a bit ahead of time and tell them what you are planning to do, without actually doing it. They can check both of your accounts and make sure there isn't some "gotcha" about the transfer you plan to do.

[targatom2019]

I did my first Roth conversion with Fidelity this years and only took one day to show up. I am planning to do another conversion mid December.

[jollystomper]

I have to call to move money from my TIRA to Roth at Fidelity (something about the age of my TIRA account). When I have called, by the end of the day the conversion is settled in both accounts. I am just moving shares between the same fund in both accounts, so that might be why it is so fast.

[misanman]

When I have converted cash, I believe it shows up instantly. I thought investments showed up right away too, but maybe it is next day.

[friar1610]

I have been wondering the same thing, except with Vanguard. I’ve pretty much decided that I will do it in 2 stages:

- stage 1, sometime this month, with a few thousand dollars, to establish the Roth. (I suspect establishing the Roth may take a little longer than a simple conversion fro an existing t-IRA to an existing Roth).

- stage 2 in mid-December when there may be estimates of CG and dividend distributions available. That way I can maybe do a better job of getting the conversion amount close to (but not over) the next IRMAA tier.

Does anyone see any reason this is a dumb idea?

[jollystomper]

Quote:

Originally Posted by friar1610 - stage 1, sometime this month, with a few thousand dollars, to establish the Roth. (I suspect establishing the Roth may take a little longer than a simple conversion fro an existing t-IRA to an existing Roth).

Not clear if you already have a tIRA at Vanguard. I created a Roth IRA for DW where she already has a tIRA. IRA was created and funds moved from the tIRA the same day. It does not take long. The same fund is in both accounts so that might have made it easier.

[O2Bfree]

Quote:

Originally Posted by ILikeStarTrek I can't promise it will always be this way, but last year I converted from a Traditional 401k (whose plan is in Fidelity) to an existing Fidelity Roth IRA. I did it on Dec 31, and the funds went out that day. The funds didn't show up in the new account until Jan 1 or 2 (I don't recall if Jan 1 is a stock-market holiday, but it was the first day the markets were open). My accountant said that since the funds went out of the old account on Dec 31 then I could still put the conversion in the 2019 tax year. If I were doing it again I wouldn't wait until Dec 31, but even Dec 30 is probably adequate. You can/should also call Fidelity a bit ahead of time and tell them what you are planning to do, without actually doing it. They can check both of your accounts and make sure there isn't some "gotcha" about the transfer you plan to do.

Looks like you were counting on a Scotty by making that move on the 31st!

I did call Fidelity yesterday, and the nice man said there shouldn't be any problems.

[SpinDoctorTX]

Quote:

Originally Posted by O2Bfree I'll be doing my first Roth conversion this year, partly to make sure I stay above the Medicaid threshold for ACA tax credits. I'm converting online across my Fidelity accounts from a TIRA to an existing Roth IRA. Can anyone who's done this with Fidelity tell me about how long it'll take to complete the conversion? I'm thinking it'd go within a few days, and I could wait until a little closer to the end of the year if I wanted to. But of course I don't want to be surprised with a long transfer time and miss the EOY deadline.

Just today I did my first conversion from my trad FID IRA into my FID Roth IRA. It'll complete tomorrow according to their notes on my pending trades. If you go to CUSTOMER SERVICE link, there will be a form you can fill in your Q, "how to convert ira funds to roth ira" or something like that was my search.

[O2Bfree]

Quote:

Originally Posted by SpinDoctorTX Just today I did my first conversion from my trad FID IRA into my FID Roth IRA. It'll complete tomorrow according to their notes on my pending trades. If you go to CUSTOMER SERVICE link, there will be a form you can fill in your Q, "how to convert ira funds to roth ira" or something like that was my search.

Ok, good to know, thanks! It sounded too easy, but having all the funds with the same company will make it so.

[friar1610]

Quote:

Originally Posted by jollystomper Not clear if you already have a tIRA at Vanguard. I created a Roth IRA for DW where she already has a tIRA. IRA was created and funds moved from the tIRA the same day. It does not take long. The same fund is in both accounts so that might have made it easier.

Yes, I do. So my experience should mirror yours.

Thanks.

[SecondCor521]

Quote:

Originally Posted by friar1610 I have been wondering the same thing, except with Vanguard. I’ve pretty much decided that I will do it in 2 stages: - stage 1, sometime this month, with a few thousand dollars, to establish the Roth. (I suspect establishing the Roth may take a little longer than a simple conversion fro an existing t-IRA to an existing Roth). - stage 2 in mid-December when there may be estimates of CG and dividend distributions available. That way I can maybe do a better job of getting the conversion amount close to (but not over) the next IRMAA tier. Does anyone see any reason this is a dumb idea?

I have a Vanguard traditional IRA and a Vanguard Roth IRA. Both contain Vanguard mutual funds.

Given those preconditions, Roth conversions that I initiate before the market close transact on both accounts as of that date, although it takes a day or two to receive the transaction details.

If you don't have an existing Vanguard Roth, you may want to call them and see if you can just open the account with nothing in it to prepare for the conversion transaction. I think they'd be able to accommodate that.

And overall, yeah, I do the same thing. I did a conversion on March 17th this year just to take advantage of the relatively low market. I'll wait to see what the dividends are, which should be about 12/23 or so, then do the rest of my Roth conversion in that last week of the year.

One final note - Vanguard only lets me convert over share amounts, not dollar amounts. And the taxable amount is the value at close of market the day the transaction is initiated. Because of this, and the desire to not exceed my AGI target, I convert perhaps 90% of my target amount first, then check again to see where I am, then do a smaller amount to get even closer. I also check the market to see what it's doing - a day like today could result in converting too much if I based the number of shares on Friday's close. Another option is just to stay comfortably far enough away from your AGI target / cliff and not try to optimize every last dollar.

[ILikeStarTrek]

Quote:

Originally Posted by O2Bfree Looks like you were counting on a Scotty by making that move on the 31st! I did call Fidelity yesterday, and the nice man said there shouldn't be any problems.

Actually I did try to start the transfer prior to Dec 31, but I found out there were some complications - namely restrictions about withdrawing (or converting) money from the 401k plan itself (which you will not have an issue with since you are converting from a tIRA). I had to reevaluate my conversion, and ended up having to do it on the 31st. But yes I should have made that initial phone call sooner so I knew about the 401k issue sooner. I wasn't happy about doing the conversion on the 31st!

[O2Bfree]

Quote:

Originally Posted by SecondCor521 ... I did a conversion on March 17th this year just to take advantage of the relatively low market. ...

Wish I'd done that! I had a little of the deer-in-the-headlights thing going regarding financial moves then. The drop was a little less than my worst-case scenario, but when it actually happened it shook me up a bit. I did manage to make my Roth IRA contribution around that time though.

[friar1610]

Quote:

Originally Posted by SecondCor521 I have a Vanguard traditional IRA and a Vanguard Roth IRA. Both contain Vanguard mutual funds. Given those preconditions, Roth conversions that I initiate before the market close transact on both accounts as of that date, although it takes a day or two to receive the transaction details. If you don't have an existing Vanguard Roth, you may want to call them and see if you can just open the account with nothing in it to prepare for the conversion transaction. I think they'd be able to accommodate that. And overall, yeah, I do the same thing. I did a conversion on March 17th this year just to take advantage of the relatively low market. I'll wait to see what the dividends are, which should be about 12/23 or so, then do the rest of my Roth conversion in that last week of the year. One final note - Vanguard only lets me convert over share amounts, not dollar amounts. And the taxable amount is the value at close of market the day the transaction is initiated. Because of this, and the desire to not exceed my AGI target, I convert perhaps 90% of my target amount first, then check again to see where I am, then do a smaller amount to get even closer. I also check the market to see what it's doing - a day like today could result in converting too much if I based the number of shares on Friday's close. Another option is just to stay comfortably far enough away from your AGI target / cliff and not try to optimize every last dollar.

Thank you.