My DH just ER'ed and will be receiving a lump sum benefit. Although we have our AA pretty much set, I've been wondering if it shouldn't be rolled into a new brokerage. My late father always said to "never put all the eggs in one basket" but when he died, it was an ordeal gathering all his eggs from all the different baskets. We currently have a 401-K at Fidelity, most of our IRAs at Vanguard, and various other smaller investments scattered at Merrill-Lynch, banks, etc. Do I 'gather them up' in one place? Divvy them up equally (or not) among several (?) brokerages/banks? Advice please.
1 thing to keep in mind is future record-keeping.
Brokerages are required to track all purchases, and match them to your sales. It's a major PIA now (with many sales in the "unknown cost basis" category), but down the road, it will be a nice feature. If you ultimately decide to consolidate, might not be bad to simply sell off a few positions in one account, transfer the cash, and just reinvest in the surviving account(s) in something else.
Also, I'd suggest moving them to just 2 (maybe 3) accounts just because it's easier to keep track of everything.. Is there really a benefit to keep $100k in one broker, and $200k in another? You could even qualify for better benefits at some brokers with higher balances (like Vanguard's Voyager, if you have enough in Vanguard ETFs/funds, or discounted commissions....not to mention various other perks at other brokers).
I realize there's the theory of 'diversification' if one broker goes bust, but given the capitalization of most of the 'big names', I find it unlikely (especially for a non-profit like Vanguard/a few others). And again, it's unlikely a major broker will be pulling the shenanigans like MF Global, et. al., since the company isn't the child of one person that built it all up themselves, and is subject to the whims (or under-the-table dealings) of one individual.
When I got big into DRIPs, I opened up DRIP accounts at the transfer agent to both save commissions, and take advantage of some DRIPs that offered discounts if you DRIP through the transfer agent...but many discontinued the DRIP discount, so I transfered all but 2 DRIPs to my TD Ameritrade account. I have a Fidelity account only because I have the Fido Visa card, which gives you 1.5% cash back on everything if you redeem the points for a cash deposit into a Fido investment account (I just transfer the cash over to my checking account then, but did buy 2 Mutual Funds that Fido offered with a lower minimum purchase compared to other companies).
When it comes to AA...even if you have all holdings at Broker A in fixed income, and all holdings at Brokers B in International stocks and all at Broker C in Mutual Funds, if you want to rebalance, it can become cumbersome to sell in one, transfer the money to a checking account, wait 7 days to clear, then transfer it again, wait for it to clear, and then repurchase. Perhaps not a huge issue, but can be annoying if you see a purchase opportunity you want to take advantage of but have to wait.
