Author Topic: Best place to transfer an IRA  (Read 3089 times)

JustStubble

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Best place to transfer an IRA
« on: October 03, 2016, 04:38:22 PM »
Hello My Mustache friends!!

I have an IRA from a previous employer that I need to roll over into a new account. I don't want to touch the money but it would be best to me if I put it in a place that I could add to it going forward and put it in a very basic low fee fund. I currently only invest in VTSMX. I don't have a mustache just stubble but I would like to roll this into an account I can manage it myself (mostly by leaving it alone).

I created an account with etrade but while I was at BofA they offered Merril Edge that would link to my current bank account. Has anyone used Merril Edge? I just want to move this once but I don't want to do anything stupid. She told me that I could move it with them, get a better interest rate on my checking account, a better rate on my home equity line of credit and higher rewards points on my CC.

Any advice I'm relitively new to financial planning so I don't want to get talked into something that will have high fee's but don't know the smart questions to ask?

Thanks!

matchewed

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Re: Best place to transfer an IRA
« Reply #1 on: October 03, 2016, 04:41:53 PM »
KISS this one. Vanguard, Fidelity, or any of the real big ones that offer index funds. Invest in one of those index funds.

Also IRA from employer?

Required reading - https://www.bogleheads.org/wiki/Investment_policy_statement
http://jlcollinsnh.com/stock-series/

JustStubble

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Re: Best place to transfer an IRA
« Reply #2 on: October 03, 2016, 04:44:28 PM »
Yea it came out of no where, I just got a letter saying they had it (21K) and offered for me to take it. I want to do that so I can keep an eye on my progress better. I don't want a managed fund but have never invested in anything but my company 401K. Do you have any exprience with Merril Edge? Prior to getting in the mustache community my go to move for stuff like this was to take the money and spend it....so dumb....

matchewed

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Re: Best place to transfer an IRA
« Reply #3 on: October 03, 2016, 04:46:35 PM »
No experience from my side on Merrill Edge. Just run the numbers on it to see if it makes sense. My gut is telling me probably not but my gut has been wrong on many things in my life. The facts will guide you on this one, not some random person on the internet and their opinions on Merrill Edge.

JustStubble

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Re: Best place to transfer an IRA
« Reply #4 on: October 03, 2016, 04:52:52 PM »
Don't listen to random people on the internet is the best advice ever......

matchewed

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Re: Best place to transfer an IRA
« Reply #5 on: October 03, 2016, 04:54:59 PM »
That and not arguing with them either. :)

MustacheAndaHalf

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Re: Best place to transfer an IRA
« Reply #6 on: October 03, 2016, 05:58:37 PM »
I'd suggest contacting Vanguard to fill out forms and get your IRA moved there.  They can handle the transfer, and then you just need to pick the fund(s).  You could go with a "target retirement" fund to make it easy.

At Vanguard it's hard to make a mistake.  The fund expenses are low because the people who invest at Vanguard are automatically also shareholders.  There's nobody but the investors to benefit from fees, so they stay low.  Many other companies like Merrill Lynch have shareholders, and they need to make a profit of you to pay shareholders a profit.

You could also setup your IRA as Schwab or Fidelity.  Both have low fee funds, but they also have higher fee mutual funds.  So you need to be more careful if you move your IRA to those companies, but you can definitely find low cost funds there as well.

Look up "rollover IRA" at the company you prefer, and let that company handle the transfer.

ooeei

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Re: Best place to transfer an IRA
« Reply #7 on: October 04, 2016, 03:15:10 PM »
Vanguard is the standard advice.  There's also nothing wrong with Fidelity or Schwab.  I have Merrill for my HSA through work, they have relatively low fees for an HSA, but I wish I could use one of the above 3.  They are part of Bank of America, and are not well known for low fees or quality investments.  They're probably better than nothing, but I don't see any advantage they have over the big 3 other than they already talked to you.

I recommend reading around in:
http://jlcollinsnh.com/stock-series/

It should give you an idea of what you should be looking for.

Spork

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Re: Best place to transfer an IRA
« Reply #8 on: October 04, 2016, 03:34:07 PM »
Vanguard.  Plain and simple.  Give them a call and they will hold your hand through the process.

My only experience with Merrill Edge is with an inherited IRA.  Great googly moogly their fees are incredibly high.  From what I've seen, ML is the absolute highest fees of any investment firm out there.  It cost me $90 to transfer that money out.  It was money well spent.

This is a flashy presentation from Personal Capital on fees.  (Note that it doesn't include Vanguard... because they're cheaper than Personal Capital.)  They estimate that $500k invested over 30 years will cost you about $1M in fees if you use ML.  I'd say that's pretty accurate.

AdrianC

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Re: Best place to transfer an IRA
« Reply #9 on: October 04, 2016, 06:46:24 PM »
Vanguard.

Merrill are a for-profit brokerage. They will try to sell you stuff.

You can't go wrong with Vanguard.

MustacheAndaHalf

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Re: Best place to transfer an IRA
« Reply #10 on: October 04, 2016, 06:49:31 PM »
You have an IRA with a Vanguard fund already in it (VTSMX), and buying / selling Vanguard funds costs $0 at Vanguard.  So even if normally you might like the fees somewhere else, it makes sense to use Vanguard for this IRA.
https://investor.vanguard.com/401k-rollover/

With This Herring

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Re: Best place to transfer an IRA
« Reply #11 on: October 04, 2016, 07:12:28 PM »
Vanguard.  Plain and simple.  Give them a call and they will hold your hand through the process.

My only experience with Merrill Edge is with an inherited IRA.  Great googly moogly their fees are incredibly high.  From what I've seen, ML is the absolute highest fees of any investment firm out there.  It cost me $90 to transfer that money out.  It was money well spent.

This is a flashy presentation from Personal Capital on fees.  (Note that it doesn't include Vanguard... because they're cheaper than Personal Capital.)  They estimate that $500k invested over 30 years will cost you about $1M in fees if you use ML.  I'd say that's pretty accurate.

Seconding this.  With OldEmployer, the profit-sharing plan was with Merrill Lynch.  They are hugely expensive.  There wasn't much money in my account, so I thought I would just play with it and put $7K or so into Exxon.  I found out that OldEmployer had chosen:
Quote from: ML rep
Due to the structure and reporting requirements, the [OldEmployer] retirement plan is on the full service Wealth Management Schedule. This is a $75 minimum commission [on purchases of individual stocks].
I'm not saying your fees would be quite that high, but ML is not one of the recommended brokers around here for a reason.

Merrill Lynch and Bank of America are the same company.  Any advice you get from a BOA rep about ML is going to be biased.  You can get those nice things with credit unions, by looking at other credit cards, etc.

Go with Vanguard.  I have Vanguard and Schwab.  Vanguard will not charge you commissions to buy and sell Vanguard funds