F.I.R.E User
Thinks s/he gets paid by the post
I have everything at Fidelity and just taxable at Vanguard.
Thanks to all for your replies so far. Here's a question. Is it easier to do Roth conversions from a tIRA at the same brokerage (in my case Schwab)? Or could I establish the new Roth accounts at a different brokerage from Schwab? I'm a newbie, only starting to learn about Roth conversions.
Just my take, but I wouldn't be too worried if you are with one of the big boys like Schwab....IMO we are the big risk, not the holding company itself. I am more worried of someone calling in and impersonating me and transferring my funds or hacking their systems....and in these cases, I think the big companies are probably investing more in training and security. Hope you have MFA on your logon at least too.
Your brokerage account contains a bunch of securities - the account is simply a holder. Mutual funds, treasuries, bonds, CDs, stocks are all securities. Each mutual fund including Fidelity mutual funds hold securities independently from Fidelity or any other fund company. These securities are not owned by Fidelity and not available to Fidelity for anything.OK. So, highly unlikely, but "what if" Fido, T Rowe or Vanguard were to pull a Lehman. What happens to the funds we own?
With stock, somewhere there's a 'piece of paper' (digital, otherwise) that says I own X shares. With a fund, how does that work?
Back in 2008 I asked this of Fido and was told not to worry because something like 'each fund is essentially it's own 'company' and would stand alone' ... or something like that.
Your brokerage account contains a bunch of securities - the account is simply a holder. Mutual funds, treasuries, bonds, CDs, stocks are all securities. Each mutual fund including Fidelity mutual funds hold securities independently from Fidelity or any other fund company. These securities are not owned by Fidelity and not available to Fidelity for anything.
I hope you keep recent statements as a backup. I keep electronic ones.
But in general it’s just a matter of time to sort things out.
FWIW Fidelity being a privately owned company- hard for it to “pull a Lehman” notwithstanding some other failure mode.
It doesn’t matter if Fido goes down. Your securities will still exist - they didn’t go poof. You will still own them. Account records will still exist. At this point SIPC would step in to help with the unwinding. So have your own recent record handy.Thanks. Makes sense. But, again, highly unlikely, if Fido et al did go south for any number of reasons, how would one get their money back? Who you gonna call?
Probably because Fidelity also does voice ID.
That could be a challenge if someone regularly records your voice. I’m sure Fidelity is thinking of it. They seem to have multiple layers of authentication.I really worry that AI faked voices can now fool voice ID.
It doesn’t matter if Fido goes down. Your securities will still exist - they didn’t go poof. You will still own them. Account records will still exist. At this point SIPC would step in to help with the unwinding. So have your own recent record handy.
https://www.finra.org/investors/ins...cease,of protection safeguard investor assets.
https://www.uscourts.gov/services-f... brokerage firm,the failed firm is liquidated.
OK. So, highly unlikely, but "what if" Fido, T Rowe or Vanguard were to pull a Lehman. What happens to the funds we own?
With stock, somewhere there's a 'piece of paper' (digital, otherwise) that says I own X shares. With a fund, how does that work?
Back in 2008 I asked this of Fido and was told not to worry because something like 'each fund is essentially it's own 'company' and would stand alone' ... or something like that.
Based on the search results, it appears that Lehman Brothers' customers did not lose significant amounts of money when the bank collapsed in 2008. The key points are:
So in summary, the search results indicate that Lehman Brothers' customers were largely able to recover their assets and did not suffer major losses when the bank collapsed. The customer accounts were protected by regulations and the SIPC stepped in to ensure an orderly resolution.
- Legally, customer assets had to be segregated from the broker's own accounts, so customer money was protected.
- The Securities Investor Protection Corporation (SIPC) announced on the day of Lehman's bankruptcy that all customer property was accounted for and no SIPC action was needed.
- Lehman's brokerage business was quickly sold to Barclays, and about $92 billion in client assets representing 110,000 retail accounts were transferred to Barclays.
- While institutional accounts took more time to resolve, the trustee liquidating Lehman's brokerage eventually announced that all brokerage customers would get their money back in full.
- In total, over $106 billion was distributed to satisfy the 111,000 customer claims, with secured, priority, and administrative creditors also receiving 100% distributions.
That could be a challenge if someone regularly records your voice. I’m sure Fidelity is thinking of it. They seem to have multiple layers of authentication.