Author Topic: Translation Betterment Recommended Funds to Fidelity Annuity Fund Equivalents  (Read 726 times)

dofdear

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Long story short, I was a Vanguard Variable Annuity customer who was shuttled over to Transamerica (TA).  Without saying anything bad about TA I've decided to do a 1035 exchange to Fidelity Annuities where customer service and transparency are superior. The problem I'm faced is translating the list of funds into equivalents that are offered by the Fidelity Annuity.  I'm seeking the forums inputs.  (Note: Please do not go down the rabbit hole regarding the investment quality of Variable Annuities.  I know but it is what it is after some 30+ years)

I started with a Betterment portfolio recommendation I felt comfortable with risk wise.  This produced a list of 11 funds, listed below.

This is the link to the annuity funds currently being offered by Fidelity: https://fundresearch.fidelity.com/annuities/category-performance-annual-total-returns-quarterly/FPRAI

And this is the list of funds I'm attempting to match with equivalents:

EMB: iShares Emerging Markets USD Bond
ETFVEA: Vanguard FTSE Developed Markets
BNDX: Vanguard Total International Bond ETF
VWO: Vanguard FTSE Emerging Markets
AGG: iShares Core Total US Bond Market ETF
VTIP: Vanguard Short-Term Inflation-Protected Securities ETF
MUB: iShares National AMT-Free Muni Bond ETF
VTI: Vanguard Total Stock Market ETF
VTV: Vanguard Value ETF
VOE: Vanguard Mid-Cap Value ETF
VBR: Vanguard Small-Cap Value ETF

Any assistance is appreciated.  Thanks,  BillyBob


terran

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I don't know about all of those, but at least (most of) the Vanguard funds trade fee free at Fidelity, so you could just keep them.

Frankies Girl

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https://www.bogleheads.org/wiki/Fidelity

I believe this is pretty up to date. It doesn't appear to have all the same funds you're listing but it has recommended fund equivalents and "Fidelity tips, links, and general orientation" links at the bottom of the page that may be helpful.
« Last Edit: December 17, 2020, 09:25:32 PM by Frankies Girl »

dofdear

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I don't know about all of those, but at least (most of) the Vanguard funds trade fee free at Fidelity, so you could just keep them.
The link I provided in my post is the only funds that may be traded in an annuity account with Fidelity.  There are no Vanguard funds listed.  Annuity accounts are markedly different than a brokerage account where you would be correct and could then trade Vanguard funds at Fidelity.  DC

terran

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I don't know about all of those, but at least (most of) the Vanguard funds trade fee free at Fidelity, so you could just keep them.
The link I provided in my post is the only funds that may be traded in an annuity account with Fidelity.  There are no Vanguard funds listed.  Annuity accounts are markedly different than a brokerage account where you would be correct and could then trade Vanguard funds at Fidelity.  DC

Ah, gotcha. I'd sort by expense ratio (low to high) and go from there. I'm seeing total market, total bond market, and total international market indexes in just the first few. The expense ratios climb pretty fast from there, so I'd probably stick with those and round out your desired asset allocation in other accounts. Although, those 3 would do it for me, as I don't think all the rest are necessary.

dofdear

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To those who responded a big thanks.   Just to recap, my Vanguard Annuity account was moved to Transamerica who's customer support is less than what I expected.  I'm in the process of moving the account to Fidelity.  Since Fidelity offers different funds in their annuity program I started with a Betterment Core Portfolio and the underlying fund recommendations.  My analysis was to translate those Betterment underlying funds to an equivalent (but not necessarily equal) Fidelity Annuity fund offering.  So here are the results of my analysis;
 
BETTERMENT                                    UNDERLYING FUND                                                               FIDELITY
International Developed Market Bonds  EMB: iShares Emerging Markets USD Bond ETF                       EMB: iShares Emerging Markets USD Bond ETF
International Developed Market Stocks VEA: Vanguard FTSE Developed Market                                   Fidelity VIP International Index
International Emerging Market Bonds    BNDX: Vanguard Total International Bond ETF                          MSD : Morgan Stanley Emerging Markets Debt Fund, Inc   (DON'T LIKE MATCH-UP)
International Emerging Market Stocks    VWO: Vanguard FTSE Emerging Market                                   Fidelity VIP Emerging Markets
U.S. High Quality Bonds                    AGG: iShares Core Total US Bond Market ETF                           Fidelity VIP Bond Index
U.S. Inflation-Protected Bonds            VTIP: Vanguard Short-Term Inflation-Protected Securities ETF    PIMCO VIT Real Return
U.S. Municipal Bonds                            MUB: iShares National AMT-Free Muni Bond ETF                        Not Applicable - (Allocation Redistributed)
U.S. Total Stock Market                    VTI: Vanguard Total Stock Market ETF                                         Fidelity VIP Total Market Index
U.S. Value Stocks - Large Cap            VTV: Vanguard Value ETF                                                         Fidelity VIP Index 500
U.S. Value Stocks - Mid Cap            VOE: Vanguard Mid-Cap Value ETF                                           Fidelity VIP Mid Cap
U.S. Value Stocks - Small Cap           VBR: Vanguard Small-Cap Value ETF                                         Fidelity VIP Disciplined Small Cap

Comments are still welcome.  I'm particularly interested in thoughts on the International Emerging Market Bonds and a better Fidelity Annuity fund for this allocation of approximately 5%.
Again, thanks to all.  BillyBob

celerystalks

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Why not just put the whole thing in FXVLT and then forget about it?

dofdear

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Because place all your asset into a single fund, albeit an S&P 500 Index Fund, is like placing all your eggs in one basket.  It is not a balanced portfolio and does not represent the market as a whole.  My goal is not to get +13% some of the time but a consistent 7 - 10% all the time.  In my case I'm in my mid 60s so want the money available and do not wish to wait on a recovery period.  BillyBob

celerystalks

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Suit yourself.
Annuities are sh*tty investments, that you can fill with sh*tty high-fee funds, and that have sh*tty tax implications.

If you insist on keeping this sucky ďinvestmentĒ, your best bet is to put all of the money in a high return low fee asset to counteract all of the negatives.  That would be FXVLT. 0.1% expense ratio + 0.25% annuity charge. Everything else they offer is basically crap.

« Last Edit: December 20, 2020, 12:22:03 PM by celerystalks »

dofdear

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Dear celeryslaks,

If you read my original post I asked that comments refrain from discussing the quality of annuity investing, "(Note: Please do not go down the rabbit hole regarding the investment quality of Variable Annuities.  I know but it is what it is after some 30+ years)"
To not continue the investment would be a significant tax burden with gains in upper 6 figures and likely taxes also in the 6 digit range between the Fed and CA.  Rather than dwell on a long over decision it's best to make the best of the situation and find quality investments so the money grows for my future and hopefully our children's.  Happy holiday and thanks for responding.  BillyBob

celerystalks

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Dear dofdear,

Yes, I did read your original post.

I donít particularly care whether someone has asked me not to say something... even if they did it politely. I say what I want. If you donít like it, then donít read it.  If you did read it and donít like it, then ignore it.

And I know all about how crappy VAs are.  I see you are super deep into it already.  So, enjoy your tax mess! It will only get worse from here. But if you had any sense at all, you would try to spend this down and to avoid passing this crap on to your kids though (a variable annuity does not get a stepped-up basis).

Enjoy your holidays and have a very happy new year!


P.S. please keep in mind that facepunches are to be expected here.. If you donít like this mode of address when you are doing something foolish, then perhaps get used to it, or stop being foolish, or go somewhere else.


« Last Edit: December 20, 2020, 01:34:08 PM by celerystalks »