Author Topic: So I transferred all my mutual funds to Vanguard, but now fees to sell?  (Read 15926 times)

Better Change

  • Stubble
  • **
  • Posts: 172
I recently transferred all my mutual funds from Edward Jones to Vanguard, thinking I'd save a ton of money in fees by cashing out and buying up some index funds (all my mutual funds have expense ratios of 0.6-1.4%....ack).  I was messing around today getting ready to sell them all, and it looks like Vanguard is going to charge me $35 to sell each fund!  I have 35 mutual funds to sell!  Is there a way around this?  I feel like I totally missed this, and I have no idea why.  Vanguard told me a "like for like" transfer of the mutual funds was the best way to go!

Can I transfer the funds back to EJ, liquidate, and then transfer the cash to Vanguard?  It took over a month to get my funds into Vanguard.  I'm not looking forward to repeating that process x 2.


LordSquidworth

  • Stubble
  • **
  • Posts: 124
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #1 on: February 06, 2015, 11:27:21 AM »
Like for like means you'll have your funds there. VG charges to sell non-VG funds or buy non-VG funds.

You shouldn't have had 35 funds to begin with. Transferring back and fourth again might get you charged for transferring. Most places do that, some waive it for having an account after x number of days.

seattlecyclone

  • Walrus Stache
  • *******
  • Posts: 5409
  • Age: 35
  • Location: Seattle, WA
    • My blog
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #2 on: February 06, 2015, 11:31:20 AM »
I'm skeptical that Edward Jones would be happy with you trying to re-open your account and transfer your funds back just to liquidate them and transfer the cash back out again.

You should have probably looked at Vanguard's fee schedule before making the switch. Looks like once you buy at least $50k of Vanguard funds you'll qualify for Voyager level services, which drops the transaction fee down to $20.

mxt0133

  • Handlebar Stache
  • *****
  • Posts: 1552
  • Location: San Francisco
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #3 on: February 06, 2015, 11:33:15 AM »
I think the proper way to go was to sell your EJ funds and then just transfer the money over to Vanguard where you can buy their funds without transactions costs.  If your goal was to get rid of the EJ funds with high expense rations and buy Vanguard funds that would have been the way to go.

Even if you transfer the funds back to EJ i'm sure there will still be some transaction costs, but with 35 funds $1225 might be worth your time to move them back, liquidate, and then transfer the case to Vanguard.  Just curious why do you event have 35 funds?

I just would consider this experience as a "teachable moment" to emphasize the benefits of a simple portfolio strategy.

Mr. Green

  • Handlebar Stache
  • *****
  • Posts: 2416
  • Age: 37
  • Location: Wilmington, NC
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #4 on: February 06, 2015, 11:37:00 AM »
I recently rolled a Fidelity IRA over to Vanguard using the "like for like" method. Only one of my funds incurred a fee but my primary concern was that the funds I was liquidating where not similar in their contents to what I was going to be buying with Vanguard. So I wanted to be able to control the exact date I liquidated because a 1-2% difference in when I sold Fidelity/bought Vanguard would outweigh the $35 fee incurred from the sale of the old fund.

skyrefuge

  • Handlebar Stache
  • *****
  • Posts: 1007
  • Location: Suburban Chicago, IL
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #5 on: February 06, 2015, 11:39:58 AM »
Vanguard told me a "like for like" transfer of the mutual funds was the best way to go!

If they didn't know you were planning on exchanging the funds for Vanguard funds, then they were correct. No capital gains taxes nor transaction fees in that case. But yes, if you were planning on exchanging them, then you would be paying capital gains taxes no matter which brokerage you sold them at, so transferring in-kind would have no extra value. However, maybe Edward Jones also has a fee to sell their funds? Maybe the Vanguard person knew their $35 fee would be lower than EJ's?

It sucks, but I guess I'd just mentally file it as the cost-of-doing-business to get out of the evil clutches of EJ.

Better Change

  • Stubble
  • **
  • Posts: 172
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #6 on: February 06, 2015, 11:51:37 AM »
I'll look into the Voyager level services.  Thanks for the heads up on that one.

My financial advisor bought me 35 mutual funds.  It took me a long time to figure out what kind of crazy stuff was happening with the money.  Many of them were part of some stupid managed account she had me in.  I've already been through that teachable moment!  I'm just trying to cut my losses here.

Mr. Green

  • Handlebar Stache
  • *****
  • Posts: 2416
  • Age: 37
  • Location: Wilmington, NC
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #7 on: February 06, 2015, 11:55:28 AM »
I'll look into the Voyager level services.  Thanks for the heads up on that one.

My financial advisor bought me 35 mutual funds.  It took me a long time to figure out what kind of crazy stuff was happening with the money.  Many of them were part of some stupid managed account she had me in.  I've already been through that teachable moment!  I'm just trying to cut my losses here.
Holy crap! Sounds like you made a good decision.

RapmasterD

  • Pencil Stache
  • ****
  • Posts: 589
  • Location: SF Peninsula
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #8 on: February 06, 2015, 12:46:15 PM »
OP - How old are you and what's the total size of your portfolio?

If, for example, you're sitting on $100,000 and you're 30 years old, then this may just be an expensive lesson - ~1% of your total portfolio - and you bite the bullet and move on...preferably into a FEW ETFs.

Melf

  • Stubble
  • **
  • Posts: 137
  • Location: Raleigh, NC
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #9 on: February 06, 2015, 12:50:12 PM »
I just sold a couple of high ER mutual funds yesterday in my Vanguard account that I did an an in-kind transfer from Morgan Stanley last year.  I incurred no sales fees or loads however.  This may be because my Vanguard account balance is over a certain level though as was mentioned before.  I have a few others to sell also but I'm easing my way out so as not to have too much in capital gains in one year.  At least I'm not paying my old Morgan Stanley FA the yearly account fees and any sales fees he would have hit me up for had I left my money there.  At least he only had me in five different high ER/loaded funds rather than 35.  That is crazy!

Better Change

  • Stubble
  • **
  • Posts: 172
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #10 on: February 06, 2015, 01:05:41 PM »
I'm 30.  Exchanging $250,000.  I'm going to call Vanguard tonight and see what I can finagle.  My husband and I are probably going to combine our investments (he's already at Vanguard) so we can get upgraded services.  I think I can probably find ways to make this hurt less.

Yes, thinking about what happened at EJ makes me feel sick.

sabertooth3

  • Stubble
  • **
  • Posts: 109
  • Location: MD
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #11 on: February 06, 2015, 01:40:18 PM »
I'm 30.  Exchanging $250,000.  I'm going to call Vanguard tonight and see what I can finagle.  My husband and I are probably going to combine our investments (he's already at Vanguard) so we can get upgraded services.  I think I can probably find ways to make this hurt less.

Yes, thinking about what happened at EJ makes me feel sick.

Don't forget about capital gains taxes too. You may want to find out when each of those funds were purchased so you can sell long-term positions (held >1 year) over short-term positions.

Indexer

  • Handlebar Stache
  • *****
  • Posts: 1463
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #12 on: February 06, 2015, 05:00:43 PM »
What funds did they have you in?   Most of the time EJ uses A shares, and I thought VG didn't charge an additional fee for those on account the fees are already insanely high.


Runge

  • Stubble
  • **
  • Posts: 219
  • Location: TX
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #13 on: February 06, 2015, 05:31:59 PM »
Since it looks like you have less than 50k in vanguard funds, shouldn't you have 25 trades discounted to $7 each? The other 10 trades would be at $20 each according to their fee structure, unless I'm missing something.

LordSquidworth

  • Stubble
  • **
  • Posts: 124
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #14 on: February 06, 2015, 05:47:01 PM »
I'm 30.  Exchanging $250,000.  I'm going to call Vanguard tonight and see what I can finagle.  My husband and I are probably going to combine our investments (he's already at Vanguard) so we can get upgraded services.  I think I can probably find ways to make this hurt less.

Yes, thinking about what happened at EJ makes me feel sick.

https://personal.vanguard.com/us/whatweoffer/stocksbondscds/feescommissions

Answers there.

Last I knew VG counts all accounts under the same address, so you and your husband combined would be the number you'd be looking at.

seattlecyclone

  • Walrus Stache
  • *******
  • Posts: 5409
  • Age: 35
  • Location: Seattle, WA
    • My blog
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #15 on: February 06, 2015, 06:16:48 PM »
Since it looks like you have less than 50k in vanguard funds, shouldn't you have 25 trades discounted to $7 each? The other 10 trades would be at $20 each according to their fee structure, unless I'm missing something.

Stock trades are priced differently than non-Vanguard mutual fund trades.

Better Change

  • Stubble
  • **
  • Posts: 172
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #16 on: February 07, 2015, 09:57:44 AM »
I called Vanguard and got upgraded to the Voyager level, which reduces the sale fee to $20.

It seems like I have 10 or so Class A funds, and those indeed won't cost me anything on the Vanguard side to sell.  So my plan is to sell all my Class As (the bulk of the money) and hold on to the other ones until they reach the 1 year mark, which happens in a few months.

I cut some losses.  I'm still so happy to be out of Edward Jones.  Now to get my parents outů.

netskyblue

  • Pencil Stache
  • ****
  • Posts: 637
  • Location: Midwest USA
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #17 on: February 07, 2015, 11:57:56 AM »
I'm skeptical that Edward Jones would be happy with you trying to re-open your account and transfer your funds back just to liquidate them and transfer the cash back out again.

You should have probably looked at Vanguard's fee schedule before making the switch. Looks like once you buy at least $50k of Vanguard funds you'll qualify for Voyager level services, which drops the transaction fee down to $20.

WHOA all those fees!

I'm not understanding all that.  If I wanted to say, open an IRA and add $211/paycheck, split over 3 different funds 60/30/10, how would that work out?  Or is that impossible?

seattlecyclone

  • Walrus Stache
  • *******
  • Posts: 5409
  • Age: 35
  • Location: Seattle, WA
    • My blog
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #18 on: February 07, 2015, 12:22:28 PM »
I'm skeptical that Edward Jones would be happy with you trying to re-open your account and transfer your funds back just to liquidate them and transfer the cash back out again.

You should have probably looked at Vanguard's fee schedule before making the switch. Looks like once you buy at least $50k of Vanguard funds you'll qualify for Voyager level services, which drops the transaction fee down to $20.

WHOA all those fees!

I'm not understanding all that.  If I wanted to say, open an IRA and add $211/paycheck, split over 3 different funds 60/30/10, how would that work out?  Or is that impossible?


I believe you can do that at Vanguard without any fees, provided that:
1) You're investing in Vanguard's own funds, and
2) You've already invested the minimum amount in each fund (often $3k, sometimes more or less depending on which fund).

netskyblue

  • Pencil Stache
  • ****
  • Posts: 637
  • Location: Midwest USA
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #19 on: February 07, 2015, 01:03:37 PM »
I'm skeptical that Edward Jones would be happy with you trying to re-open your account and transfer your funds back just to liquidate them and transfer the cash back out again.

You should have probably looked at Vanguard's fee schedule before making the switch. Looks like once you buy at least $50k of Vanguard funds you'll qualify for Voyager level services, which drops the transaction fee down to $20.

WHOA all those fees!

I'm not understanding all that.  If I wanted to say, open an IRA and add $211/paycheck, split over 3 different funds 60/30/10, how would that work out?  Or is that impossible?


I believe you can do that at Vanguard without any fees, provided that:
1) You're investing in Vanguard's own funds, and
2) You've already invested the minimum amount in each fund (often $3k, sometimes more or less depending on which fund).

Oh, ok.  Whew.  Thought I was going to have to rethink things.

SaintM

  • Guest
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #20 on: February 07, 2015, 03:33:00 PM »
Vanguard incurs a cost to get you out of your old mutual funds, so they pass that along. EJ would incur the same cost, and probably charge you just as much if not more.

EJ is such a shitty business. I felt very fortunate to get away when I did. Now that I live in St. Louis their advisors are everywhere.

Indexer

  • Handlebar Stache
  • *****
  • Posts: 1463
Re: So I transferred all my mutual funds to Vanguard, but now fees to sell?
« Reply #21 on: February 08, 2015, 07:55:18 AM »
I called Vanguard and got upgraded to the Voyager level, which reduces the sale fee to $20.

It seems like I have 10 or so Class A funds, and those indeed won't cost me anything on the Vanguard side to sell.  So my plan is to sell all my Class As (the bulk of the money) and hold on to the other ones until they reach the 1 year mark, which happens in a few months.

I cut some losses.  I'm still so happy to be out of Edward Jones.  Now to get my parents outů.

Have your parents sell anything that isn't an A share before they leave.

Vanguard incurs costs to sell your funds.  Now with A shares the costs are all up front so VG nor EJ will charge you to sell.  The other funds VG probably will charge you because the other firm charges them.  Since EJ has been making money off those funds they may not charge to sell them so it is always good to check.

Something else you can always do is type the ticker symbol for the funds into the search box on the VG page.  Then click on the 'fees' tab.  That will show you if VG charges an additional fee.

Quote
I'm not understanding all that.  If I wanted to say, open an IRA and add $211/paycheck, split over 3 different funds 60/30/10, how would that work out?  Or is that impossible?

VG has a couple specialty funds that have a fee to buy, but as a general rule if you buy VG funds/ETFs directly through them there is no fee to buy or sell.  VG just charges if you trade 'other' companies funds.  Now a company like EJ would charge you about 5% every single time you added to a fund.  This is why you don't want to use them.