FIDO Distribution Option(s)

[Red Badger]

Hi all.

As mentioned a few times, we are recently retired. Prior to retirement, I structured our stuff as follows:

12-18 months cash

FIDO Stuff - 2-3 years in stable value fund and the balance in 60/40 equities/bonds (index funds, baby!) . My plan was to use cash and to siphon off some the stable value funds until SS kicks in (<2 years) and let the rest of the portfolio flow with market whims.

So, upon retirement, I took a minimum ($500) distribution just to ensure the transaction would hit my credit union without any SNAFU or FUBAR situations. Good news - no issues - took about 4-5 days.

Question. is there a way with FIDO to only pull $$ from one fund? In my case, it would be the SV fund. I did not see any option on the FIDO web site and the initial transaction pulled equal percentages from my 5 funds. I can re-balance prior to taking a distribution, but by then, I'd have my shoes and socks off, having run out of fingers long ago.

I haven't called FIDO yet - they might try to sell me some managed crap. Ergo, my shout out here. Thanks in advance for any insights.

 

[LOL!]

Fidelity has automated withdrawal, so I don't see why you cannot do what you want. They are supposed to have great customer service, have you use online chat or called them?

They've never tried to sell me anything when I have talked to them.

https://moneymovement.fidelity.com/ftgw/fbc/mm/awSummary

I have something set to look EVERYDAY to see if a dividend is paid and if so, then it is withdrawn and sent to my external checking account. That ensures that every dividend paid -- no matter when -- is sent to my external checking account.

 

[MRG]

I think you can do what you want to. It's a matter of you telling Fidelity what you want. I'm assuming you have a 401k, IRA, or brokerage through Fidelity

I think they default to FCash, if not enough is there they go to funds with checkwriting privlige and redeem equally to fulfill the withdrawal. Of course I could be full of crapola cause I've not actually done this exact transaction(similar ones that aggregate together).

There's a few things in life I'm sure of. One is Fidelity isn't going to try to sell me crap. Maybe that's in my profile? [emoji2]

Call them.

 

[bingybear]

I've never tried an auto withdraw. I use Fido bill pay to pay most of our bills. I use a cash management account for the bill pay and have it draw $ from a brokerage account when the cash management account runs below $3k. I keep some cash the brokerage account such that I need to top it of every 6 to 12 months. Most of the investments in the brokerage accounts kicks out some dividends, but about half of those reinvest. The other is just used a spending cash.

I know it does not really answer your question, but maybe shows a different way to handle withdraws.

 

[Travelfreek]

FIDO Distribution Options(s)

Funny you should ask that. We just went through that. The only way to do it is to have a phone conversation with FIDO while they do it for you. I recently sold a couple of high performing funds to get $20k cash into the account (403b type). I learned that to use the $20k in the cash fund, I had to call Fidelity myself instead of the online option. The online option withdrawal would have pulled from all the investments instead.

Our goal was to put $20k down on our house mortgage now and again over the next 5 years. I needed a bit more than 20k since there's the 20% required fed tax withholding and 2% required state tax withholding when withdrawing from the 403b or 457 type account. So, I grabbed $3400 from my husband's rollover IRA in FIDO to make up the rest of the needed money for the $20k without a hitch (did it online). I realized the next day I made a boo boo and neeeded another $300. When I tried to pull the $300 from the rollover, I happened to notice in the blank space marked TYPE (of withdrawal), the word EARLY was in it. Uh Oh! So, I didn't finish the $300 withdrawal and called Fidelity in a bit of a panic. My husband is 59 years old plus 5 months (not quite 59 1/2). OMG! How could I have screwed this up? Anyway, thank goodness, the Fidelity rep said we could send the $3400 back to Fidelity with my approval from the credit union (reverse EFT) since we were within 60 days of the withdrawal. Whew! She said this is a one time thing in a 365 day period. Thank the Lord! This saved us $340 in penalties. So, next month when he turns 59 1/2 for real, I can pull the $3400 + $300 from his rollover IRA without the penalty. He retired last month and he's able to pull from the 403B without penalty since he's retired. I pride myself in knowing a lot about this stuff but had a brain freeze apparently as I was trying to find money invested in cash type investments to pull from. Fidelity said I can bring the document they issue to our CPA for our tax return next year to ensure we don't pay any type of early withdrawal penalty.

 

[Red Badger]

Wow! Thanks everyone! I guess I'll call FIDO and get the ball rolling. FWIW - this is a 401K.

 

[LOL!]

401(k)s are different. I had a 401(k) with Fido and always needed to talk to the 401(k) folks instead of the regular folks. Good luck!

The netbenefits.fidelity.com site has limited options compared to the full fidelity.com site.

 

[Red Badger]

401(k)s are different. I had a 401(k) with Fido and always needed to talk to the 401(k) folks instead of the regular folks. Good luck!

The netbenefits.fidelity.com site has limited options compared to the full fidelity.com site.

Once again, the devil seems to be in the details. My account is @ netbenifits... Regardless, I'll give NetFIDO a call and sort this out.

Again, Thanks FIRE team!

 

[jazz4cash]

Some of the details for 401k distributions are mandated by the employer. I have moved a chunk (eg rollover) from my 401k (managed by Fido) into a Fido IRA. When I log into Fido, the IRA shows up alongside my other accounts.

Out of curiosity I went through the steps to setup automatic distributions:
I can choose automatic payments to my linked bank account but only the IRA accounts show up as eligible for this feature. There are many selections for withholding and fixed $ or %, frequency, etc. I can choose distribution across all eligible funds or specific funds only. In my case the core account (MM account) is the only one eligible. I cannot choose to distribute from individual stocks. It all looks pretty straightforward.

 

[MRG]

401(k)s are different. I had a 401(k) with Fido and always needed to talk to the 401(k) folks instead of the regular folks. Good luck!

The netbenefits.fidelity.com site has limited options compared to the full fidelity.com site.

Ding ding ding. It's the difference between individual and institutional accounts.

Different systems for different customers.

 

[DewIt]

I had the same kind of situation as you when I retired, I thought like you did that you could specify what investments were sold. As you found out, they keep your allocation the same by selling from each fund. I was told that I could rebalance after taking a distribution. Not exactly how I wanted to do things. I already had a brokerage account with my 401k, so I moved all stocks and REITS and the like to the brokerage account, and had just the Stable Value Fund and Bond Funds in the core account. The default distribution method was to take just from the core funds, so that solved the problem in a way. Hope that helps!

 

[GravitySucks]

FIDO makes me do the same thing on my 401K. Both my personal rep and 401K rep said that's the only way to do it.
I rolled over most of the 401k to an IRA where I feel I'm more in control. Had to leave enough in the 401k to live between 55 and 59.5.

 

[FiveDriver]

I'm close to starting RMD's thru FIDO, and I was thinking about setting it up in the following way.....

I have a Rollover IRA and tIRA with FIDO. I would like to setup a Stable Value-type fund to use as a "Cash Bucket" with around 2 years of withdrawals. I would like FIDO to ACH every month into my local checking account.

Or it might just be better to just Dollar Cost Average out of the Equity Funds in there.

I haven't run this past my FIDO rep yet......does it make sense to the ER Council ??

 

[jazz4cash]

Good luck finding anything like a Stable Value Fund at Fido. My Fido core accounts pay ~0.70%. I use Ally savings and CDs for my cash buckets.

 

[FiveDriver]

Maybe one of FIDO's Target Date Funds has a similar "Stable" allocation ??

The more I think about this, the DCA monthly paycheck into local checking account might be better for us. Can I direct them to take the entire RMD from just one of my rollo IRA and tIRA accounts ??

I will check this scenario with them today or tomorrow....just brainstorming it here first.

 

[jazz4cash]

Maybe one of FIDO's Target Date Funds has a similar "Stable" allocation ??

The more I think about this, the DCA monthly paycheck into local checking account might be better for us. Can I direct them to take the entire RMD from just one of my rollo IRA and tIRA accounts ??

I will check this scenario with them today or tomorrow....just brainstorming it here first.

How'd you make out on this? Based on my test it looks like it should be no problem designating a fund for monthly xfer to a taxable account.
I checked and see there is Fido Freedom Income FFFAX but it is 24/46/30 so pretty aggressive compared to typical SV Fund.