Edward Jones to Vanguard

[Jay Bird]

I know this has already been discussed on a number of posts. I would like to post our specific situation in case I'm overlooking something, and would appreciate any comments/advice.

We're going to move all of our investments from EJ to Vanguard.

We don't have the $50K needed at Vanguard to benefit from their lower fees at this time, but I expect we will before too long.

At EJ we have IRAs, Roths and Money Market Funds.

We can transfer the IRA/Roths "in kind"

For the other investments/Money Market Fund.
There are some that cannot be transferred, we'll sell those.
At the same time, we'll assess to see if there's something that we're holding that is an obvious loss, and if it would be better to sell now as a way to counter any gains.
Transfer everything else "in kind" with the idea of liquidating over time, but hold as it as for the moment.

Also I think that we will have access to funds that would allow us to increase our 401K contributions to equal the annual maximum, and for a short time live off our own funds. Again with the idea of reducing IRS taxes owed come April. These funds are over and above, coming from inheritance, so not using any of the funds being discussed here.

[seattlecyclone]

I know this has already been discussed on a number of posts. I would like to post our specific situation in case I'm overlooking something, and would appreciate any comments/advice.

We're going to move all of our investments from EJ to Vanguard.

Great!

We don't have the $50K needed at Vanguard to benefit from their lower fees at this time, but I expect we will before too long.

At EJ we have IRAs, Roths and Money Market Funds.

We can transfer the IRA/Roths "in kind"

You are planning to switch your investments to Vanguard funds in the very near future, right? That's really the most important part of moving your account. Sticking with the same terrible funds your EJ guy sold you is not a great idea. You will pay no taxes on any trades within your IRAs, so there's no reason to keep what you have for the long term.

Have you looked into what it would cost for you to liquidate your funds before making the transfer? Vanguard charges $35 per transaction for most non-Vanguard mutual funds ($20 once you get to $50k in Vanguard funds). I have no idea what EJ charges per transaction, but it's possible it would be less than that for their funds.

For the other investments/Money Market Fund.
There are some that cannot be transferred, we'll sell those.
At the same time, we'll assess to see if there's something that we're holding that is an obvious loss, and if it would be better to sell now as a way to counter any gains.
Transfer everything else "in kind" with the idea of liquidating over time, but hold as it as for the moment.

In your taxable account it's important to consider taxes on transactions, but don't let that be your primary consideration. If you have high-fee funds, you really should consider getting rid of them soon, either all at once, or split over 2015 and 2016. Capital gains taxes really aren't that bad in most cases. You'll might pay 15% tax on any long-term gains if your regular income is in the 25% or higher bracket; even if your funds have doubled in value since you have bought them it's just a one-time 7.5% charge to switch to a better fund at Vanguard. If you wait, you'll be paying 1% per year and then will still pay that same tax when you sell. Everyone's tax situation is different, but most people will be better off switching sooner rather than later.

Also I think that we will have access to funds that would allow us to increase our 401K contributions to equal the annual maximum, and for a short time live off our own funds. Again with the idea of reducing IRS taxes owed come April. These funds are over and above, coming from inheritance, so not using any of the funds being discussed here.

Maxing out your 401(k) is a good idea. Even if you have to sell some of the funds in your taxable account coming over from EJ to make this happen, you should strongly consider it.

[MDM]

We don't have the $50K needed at Vanguard to benefit from their lower fees at this time, but I expect we will before too long.

You can get admiral class shares for $10K in many funds.  The ~0.18% fee for a target date retirement fund ($1K minimum) is itself likely less than whatever EJ was charging.  In any case, it appears you are making a good choice.

[Indexer]

1. GREAT move!
2. With the IRA there is no tax benefit to moving it in kind. Look at fees. Stocks/ETFs will likely be more expensive to sell at EJ so move them in kind and sell them at Vanguard($7/trade). Mutual funds can probably be sold at EJ for no fee because you probably paid a load to get into them. Look into this before doing the in kind transfer on the IRAs.
3. 50k in Vanguard funds gets you better services like cheaper brokerage trades if you trade a lot(which you shouldn't), or if you get physical statements(why would you?), but in many cases it doesn't make a difference. If you buy VTSAX(10k min) you pay the same % expenses whether you have 10k or 100k. That expense by the way is 0.05%! Or even if you have less than 10k you can use Vanguard's index ETFs. VTI is the same thing as VTSAX and the same cost, but since it is an ETF you only need to have enough $ to buy a share as opposed to needing 10k.