Most efficient way To move taxable accounts from Trowe Price to Vanguard

[mamabear18]

Hi everyone!

I have a Roth IRA and a taxable account at Trowe. I would like to move the money to Vanguard in similar accounts. Initially, I was planning to close the accounts, sell the funds and buy new funds at vanguard (I already have accounts there), but I came across a post that suggested moving funds from Trowe to ETFs at Trowe and then transfer to vanguard? Will I avoid paying taxes on this? I don’t want to cash out if I have to pay taxes. If there is a way to save or not pay taxes - I am happy to learn. Any suggestions would be helpful. Or should I just keep my money at Trowe? Their fees are a little higher and I’m tired of the fees. Thank you!

[ATtiny85]

I don't think you will be able to avoid both fees and taxes. Even if you transfer in-kind to Vanguard, you are still paying the internal fund expense ratio, whether it is a mutual or ETF. I took a quick look and it looks like TRP ETF have "high" expense ratios.

Turn off reinvestment, funnel those to Vanguard. Sell anything with losses, funnel that to Vanguard. Or, sell as much as possible to net zero gains, and see where things stand.

I have one remaining fund holding at TRP. It is now pure house money (thanks to large taxable distributions) and it would take a 1929 level crash to get out without taxes, so I just let it ride.

[MustacheAndaHalf]

The largest brokerages charge $0/trade for both stocks and ETFs.  This appears to be the case at T Rowe Price as well:
https://www.troweprice.com/personal-investing/accounts/brokerage/index.html

Which means you can buy any ETF there, not just T Rowe Price ETFs.  You should be able to buy VTI (Total U.S. Stock Market) and VXUS (Total International ETF) at T Rowe Price.  Within your Roth IRA, buying and selling will not incur capital gains.

I had most of my assets at Vanguard for many years, but now have most of my assets at Schwab.  If you're moving to Vanguard for lower costs, Schwab and Fidelity have the same fees.  In my view, since Vanguard's founder stepped down, the company hasn't been a low cost leader: Vanguard actually implemented $0/trade after Fidelity and Schwab.  Fidelity's "zero expense ratio" mutual funds are another innovation Vanguard hasn't even attempted.  You might want to consider Schwab or Fidelity when moving out of T Rowe Price.

[travel2020]

I had a after-tax mutual funds as well as an IRA account at TRow for several years. I did look at consolidating at Vanguard but found their interface to be clunky and customer service mediocre, so ended up moving after-tax to Fidelity and retirements to Schwab.

The process of moving out of TRow price is pretty straightforward and easiest to do an in-kind transfer of TRow Price funds. I’ve sold off some funds and switched to lower cost funds and still hold some that I’m planning to sell over a couple of years to avoid a big tax hit at once. The transfer itself only took a few days and I just needed to provide the account info and upload the most recent statement for reference.

You will incur fees (it might depend on your assets in the account but not sure)when you sell those funds outside of TRow price so if you are doing this to get into low cost index funds, it might be better to sell and then transfer but be mindful of the taxes.

I do recommend looking at Fidelity and Schwab. I was a TRow and Vanguard customer for many years and while not unhappy at either, I find both Fidelity and Schwab to have a better setup and service overall.