Hey MMM,
I have recently been digging in and figuring out what my financial advisor (FA) has been doing with my accounts. I have learned that my money is spread out across numerous funds which is good, but many of them have really high Expense Ratios that are killing the gains.
I currently have five accounts with my FA and want to move them all over to Vanguard. I have:
-my IRA account
-wife's IRA account
-my Roth account
-wife's Roth account
-brokerage account
I know that I can rollover the first four accounts over to Vanguard without paying any fees (hopefully there are no termination fees with my current broker), but what I am most concerned about is the brokerage account.
Within that account, there are the following funds (and expense ratios):
KNPCX (2.39% - yikes!)
NMUCX (1.85%)
VADCX (1.31%)
WASCX (1.68%)
WSSCX (1.35%)
All of these are C-class shares which will have a back-end fee of probably 1% (only on the recent share purchases of the last year which is probably a decent chunk of it).
With that, I have three questions:
1) How do I go about initiating the transfer for the brokerage account? Do I have my FA close the account and "cash out" the shares? Then purchase with Vanguard?
2) This will be my first time paying capital gains taxes as I have never sold shares before, is there a way to minimize the taxes here since I will be re-investing immediately? (I think I know the answer: no. But would like confirmation)
3) In regards to minimizing future tax burden and correctly setting up new Vanguard accounts, how should I structure my asset allocation across accounts? It is better to do equities or bonds in a tax-advantaged account? Or do I maintain my desired AA across all accounts individually?
Thanks so much!!
Dave