Changes needed after ER?

[getoutearly]

I'm planning to ER in ~4.5 yrs or less.  I'm in the process of getting everything (taxable, non taxable accts) moved to Vanguard most likely (from a FA / bank). 

I'm wondering, is there anything I need to keep in mind as I set up the Vanguard accounts etc, looking ahead to the time I start taking monies out of the account to live on?  Probably a stupid question, but I've always been on the saving side, not the withdrawing side. 

Any gudance on how to set things up, pitfalls to avoid?  Is there a financial institution (Vanguard, E-Trade , Fido... that is better at handling the basis-tracking etc, so I can most easily determine the best way to withdraw funds without incurring unenecessary taxes, fees etc? 

I don't wnat to go through the process of getting rid of the FA, only to find that I neeed him again when it comes time to start living off the investments. 

I'm probably making this more complicated, in my head, than it will actually be...

 

[mathjak107]

i found fidelity to have a fabulous features for controlling the flow of retirement income.both incoming and out going

 

[BUM]

I'm probably making this more complicated, in my head, than it will actually be...

Yes, like me, you probably are. But hey, this is a good time to pay attention to the details. VG will likely set you up with a few accounts:
1. Your IRA
2. Joint account
3. Individual account
4. Spouses IRA

Each account will have a money market position used for cash deposits, contributions and sweeps from dividends and gains. This cash can be invested any way you decide. Dividends and gains (and principal ) can be automatically transferred to the cash accounts and disbursed to you. IMO VG does a good job of tracking basis and average cost info once they get you setup. Prior to that you need to keep the records. When transferring I liquidated almost everything for that very reason except a few stocks that I've owned for many years. That basis info I keep.

No pitfalls that I can think of. Just keep you old buy/sell info on file and enjoy firing your FA!


OBTW assuming you are married get things setup in the beginning to allow whomever makes those decisions to trade on all accounts.

l

 

[lazyday]

If you want to use specific identification for cost basis (for your taxable account) you might have a much easier time at a different broker than Vanguard.

My understanding is that VG doesn't offer specific ID. Some people write letters to VG saying which shares they are selling/sold, hoping that would be good enough.

Some other brokers do offer specific ID accounting, such as by letting you enter the info when selling online. Fidelity probably does, but you might want to check if they do for both stock and mutual fund sales.

Some brokers don't have the online capability, but do specific ID if you sell on the phone and tell the broker which shares you're selling.

Depending on people's interpretation of IRS rules, you need something in writing from the broker identifying the shares. With some brokers, it is right on the transaction statement. Some people think your own writing returned to you from the broker (VG) is enough.

This has been discussed in detail at diehards.org.
Fairmark.com also has some description of what may be needed to comply, should you choose specific id.