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Best way to move ROTH IRA to Vanguard

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  • Best way to move ROTH IRA to Vanguard

    Need advice on the most cost effective way to transfer my ROTH IRA from scammer financial institute (bunch of random "dividend-yielding" stocks and poor mutual funds with high expense ratios) to Vanguard.

    People have said you can occur high expenses liquidating all the funds and then transferring.

    Is it better to have my advisor dump the collection of stocks/mutual funds and buy 100% of VTSAX mutual fund and then initiate the transfer? Would this be cheaper?

  • #2
    You can sell/buy funds within the Roth and it doesn’t create a taxable event, however, your particular funds may have penalties or fees associated with this so I would check your fund prospectus. If your funds have fees attached, it won’t matter whether you sell them before or after you transfer to Vanguard.


    • #3
      What does your current brokerage charge?
      What will Vanguard charge?
      You have to ask and find out....


      • #4
        You can always call Vanguard and they might be able to help you with the process.  The more money involved the more interested they likely will be to help.


        • #5
          Figure out whether it’s less expensive to sell at existing custodian or at Vanguard.

          if less expensive at existing custodian, sell and then do a trustee-to-trustee transfer.

          if less expensive to sell at Vanguard, do an as-is trustee-to-trustee transfer and sell once the holdings arrive at Vanguard.

          Thekey is to make sure you doa trustee-to-trustee transfer. Indirect transfers are fraught with peril.