In-Kind transfer noob questions

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Topic Author
Kookaburra
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Joined: Thu Apr 02, 2020 11:14 pm

In-Kind transfer noob questions

Post by Kookaburra »

I would like to transfer in-kind some Vanguard mutual funds held in a Vanguard taxable brokerage account over to a different institution, such as Fidelity. I have never done this before (but I have experienced multiple Vanguard screw-ups in the past on some simple rollover requests), so I’m hoping for some insights from the community to have this process go smoothly.

Questions:

1. Can I transfer just some of my Vanguard holdings, as opposed to the entire brokerage account? If so, how do I specify which?

2. My understanding is that I initiate this process by working with the ‘receiving institution’, in this case Fidelity. Is there anything I need to do or communicate to Vanguard, or does Fidelity handle it all?

3. What do I need to do to ensure the cost basis also gets properly transferred? (I do plan to download my cost basis screen on Vanguard in case they screw it up).

4. Any other pearls of wisdom or lessons learned?

Thank you
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Wiggums
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Re: In-Kind transfer noob questions

Post by Wiggums »

You make the request with Fidelity and they will do the rest.

Yes, you direct Fidelity on which funds and how much of each fund to transfer. You specify this information on the Fidelity request.

Investigate the fees charged if you buy more Vanguard funds at Fidelity. There won’t change you to sell the Vanguard funds.

If moving Vanguard mutual funds, is there an ETF equivalent? If so, you might want to convert to the ETF prior to the transfer.
Last edited by Wiggums on Tue Nov 30, 2021 5:01 pm, edited 2 times in total.
"I started with nothing and I still have most of it left."
nalor511
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Re: In-Kind transfer noob questions

Post by nalor511 »

Kookaburra wrote: Tue Nov 30, 2021 4:46 pm I would like to transfer in-kind some Vanguard mutual funds held in a Vanguard taxable brokerage account over to a different institution, such as Fidelity. I have never done this before (but I have experienced multiple Vanguard screw-ups in the past on some simple rollover requests), so I’m hoping for some insights from the community to have this process go smoothly.

Questions:

1. Can I transfer just some of my Vanguard holdings, as opposed to the entire brokerage account? If so, how do I specify which?

2. My understanding is that I initiate this process by working with the ‘receiving institution’, in this case Fidelity. Is there anything I need to do or communicate to Vanguard, or does Fidelity handle it all?

3. What do I need to do to ensure the cost basis also gets properly transferred? (I do plan to download my cost basis screen on Vanguard in case they screw it up).

4. Any other pearls of wisdom or lessons learned?

Thank you
1. YES. It's part of the form you fill out on fidelity.com
2. NO. BUT I would recommend calling Vanguard first to convert your MF shares to ETF shares, and then screenshot the cost basis just so you can check it later. ETF shares are free to trade everywhere, MF shares
are not.
3. Screenshot before. Check after a week or two.
4. Convert to ETF first, wish I'd done that for all my shares instead of half.
KeepingEyesOpen
Posts: 81
Joined: Sat Dec 12, 2015 9:49 pm

Re: In-Kind transfer noob questions

Post by KeepingEyesOpen »

Kookaburra wrote: Tue Nov 30, 2021 4:46 pm
1. Can I transfer just some of my Vanguard holdings, as opposed to the entire brokerage account? If so, how do I specify which?

2. My understanding is that I initiate this process by working with the ‘receiving institution’, in this case Fidelity. Is there anything I need to do or communicate to Vanguard, or does Fidelity handle it all?

3. What do I need to do to ensure the cost basis also gets properly transferred? (I do plan to download my cost basis screen on Vanguard in case they screw it up).

4. Any other pearls of wisdom or lessons learned? …
I just did this (transferred in kind from Vanguard to Fidelity) for a substantial brokerage account.

1. Yes. Start with Fidelity, open an account. Defer funding until you verify the account is open and registered to your satisfaction and that you can log in, etc. This is usually the next day. In the meantime, download, check and save your cost basis info from your Vanguard account. Make sure you have Specific ID or Average Cost info, as you want it.

2. In the Fidelity web portal, initiate the transfer. Go to Trade & Transact > Transfer > From: Transfer an account to Fidelity. This will lead you to select the other firm (Vanguard), then you will be prompted to enter account number, name, etc. Make sure the account owner (or trustee) names match. Unless you specify otherwise, assets will be transferred “in kind” except for money market funds or your core or cash position.

3. Cost basis info will follow into the new account, but delayed a week or so. Again make sure you use the default option to transfer assets in kind.

4. If desired, call Fidelity and ask for a transfer specialist. That person can walk you through the process, even share your computer screen to walk you through. Transferring the entire account is easier than transferring individual assets. Most mutual funds, including Vanguard funds, can be transferred. Exceptions include money market funds. I found it useful to exchange certain Vanguard mutual funds for the equivalent ETF class of shares, if eligible (while still in the Vanguard account, of course).
Topic Author
Kookaburra
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Re: In-Kind transfer noob questions

Post by Kookaburra »

KeepingEyesOpen wrote: Tue Nov 30, 2021 5:25 pm Transferring the entire account is easier than transferring individual assets.
Could you elaborate on this?

Also, when you did your recent transfer, were you able to negotiate a transfer bonus with Fidelity?

Thanks for your detailed response.
delamer
Posts: 17453
Joined: Tue Feb 08, 2011 5:13 pm

Re: In-Kind transfer noob questions

Post by delamer »

KeepingEyesOpen wrote: Tue Nov 30, 2021 5:25 pm
Kookaburra wrote: Tue Nov 30, 2021 4:46 pm
1. Can I transfer just some of my Vanguard holdings, as opposed to the entire brokerage account? If so, how do I specify which?

2. My understanding is that I initiate this process by working with the ‘receiving institution’, in this case Fidelity. Is there anything I need to do or communicate to Vanguard, or does Fidelity handle it all?

3. What do I need to do to ensure the cost basis also gets properly transferred? (I do plan to download my cost basis screen on Vanguard in case they screw it up).

4. Any other pearls of wisdom or lessons learned? …
I just did this (transferred in kind from Vanguard to Fidelity) for a substantial brokerage account.

1. Yes. Start with Fidelity, open an account. Defer funding until you verify the account is open and registered to your satisfaction and that you can log in, etc. This is usually the next day. In the meantime, download, check and save your cost basis info from your Vanguard account. Make sure you have Specific ID or Average Cost info, as you want it.

2. In the Fidelity web portal, initiate the transfer. Go to Trade & Transact > Transfer > From: Transfer an account to Fidelity. This will lead you to select the other firm (Vanguard), then you will be prompted to enter account number, name, etc. Make sure the account owner (or trustee) names match. Unless you specify otherwise, assets will be transferred “in kind” except for money market funds or your core or cash position.

3. Cost basis info will follow into the new account, but delayed a week or so. Again make sure you use the default option to transfer assets in kind.

4. If desired, call Fidelity and ask for a transfer specialist. That person can walk you through the process, even share your computer screen to walk you through. Transferring the entire account is easier than transferring individual assets. Most mutual funds, including Vanguard funds, can be transferred. Exceptions include money market funds. I found it useful to exchange certain Vanguard mutual funds for the equivalent ETF class of shares, if eligible (while still in the Vanguard account, of course).
Aside from the cost basis issue, is the process essentially the same for transferring a 401(k) [non- Vanguard] to Fidelity?

I assume I’d want to sell any institutional funds held in the 401(k) before intiating the transfer?
One thing that humbles me deeply is to see that human genius has its limits while human stupidity does not. - Alexandre Dumas, fils
nalor511
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Re: In-Kind transfer noob questions

Post by nalor511 »

Kookaburra wrote: Tue Nov 30, 2021 5:31 pm
KeepingEyesOpen wrote: Tue Nov 30, 2021 5:25 pm Transferring the entire account is easier than transferring individual assets.
Could you elaborate on this?

Also, when you did your recent transfer, were you able to negotiate a transfer bonus with Fidelity?

Thanks for your detailed response.
Fidelity doesn't really negotiate, email them and they will tell you the current offer for 1mil+(tell them what you have). Schwab will match other offers
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illumination
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Re: In-Kind transfer noob questions

Post by illumination »

I'd screenshot everything in case there's a discrepancy on cost basis.

Transferring some shares (and not others) to me sounds like a big opening for errors on cost basis. I would just make sure its the "whole" fund being transferred and not split up, at the very least.

I would convert everything I could to ETF shares before transferring to Fidelity. I would then get used to using Vanguard ETFs (or another ETF) if you are going to use Fidelity for your taxable brokerage.
KeepingEyesOpen
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Re: In-Kind transfer noob questions

Post by KeepingEyesOpen »

Kookaburra wrote: Tue Nov 30, 2021 5:31 pm
KeepingEyesOpen wrote: Tue Nov 30, 2021 5:25 pm Transferring the entire account is easier than transferring individual assets.
Could you elaborate on this?

Also, when you did your recent transfer, were you able to negotiate a transfer bonus with Fidelity? ...
Yes to transfer bonus. Just call and ask the Fidelity rep. Amount depends on the size of the assets to be transferred. Applies only to individual accounts (or simple RLT), not to HSA accounts, business accounts or employer pension plan accounts, etc.

Transferring the entire account just simplifies the process. You don't have to individually list assets, specify # or shares or dollar amount, etc. Also, transferring entire account might result in an automated transfer through the ACAT system - no human involvement to make data entry mistakes. The transfer would probably work either way, but I like to keep things simple.

One more point - transferring the entire account simplifies what I call the "follow-up sweep." After the transfer, Vanguard will continually "sweep" any residual funds and transfer automatically to Fidelity. These included residual dividends and interest, orphaned distributions, etc. I don't know how that works if you transfer only specific assets and leave holdings at Vanguard. Again, KISS. Don't make life harder than it has to be. :happy

To answer all of your questions, it's probably good to talk to the transfer specialist first, get questions answered, then do the procedure online - perhaps while the transfer specialist walks you through it using screen-sharing. Remember to do homework first - get your cost basis info from the old Vanguard account (just in case ...) and exchange appropriate holdings from mutual fund to ETF shares at Vanguard. Also ask the transfer specialist to confirm that all of your Vanguard (or other) holdings qualify to be held at Fidelity. Most regular mutual funds will, as will all ETFs.

Forgot to mention above - you will be asked to attach and send in a copy of your most recent Vanguard statement. Go ahead now and download the statement and save as a PDF file, ready to send to Fidelity. This is done by attaching to "secure email" in the message part of the web portal.
Collectingnuts
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Re: In-Kind transfer noob questions

Post by Collectingnuts »

I am doing just the same as it turns out Dec 1st. What is the best way to capture the cost basis info? I have quite a few holdings to screen shot.
KeepingEyesOpen
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Re: In-Kind transfer noob questions

Post by KeepingEyesOpen »

delamer wrote: Tue Nov 30, 2021 5:41 pm
Aside from the cost basis issue, is the process essentially the same for transferring a 401(k) [non- Vanguard] to Fidelity?

I assume I’d want to sell any institutional funds held in the 401(k) before intiating the transfer?
I would think that this would be a rollover from 401k to a an individual rollover IRA, correct?

You should ask the appropriate rollover IRA or transfer specialist at Fidelity regarding transfer of or holding of specific institutional funds at Fidelity.

I recently transferred a rollover IRA account and a trust brokerage account to Fidelity, described above, simple and easy. Years ago I did a rollover of a qualified employer pension plan to Fidelity. The procedures were similar, but not identical. Your 401K custodian may require some additional paperwork, maybe even notarized documents. Best to check with Fidelity and your 401K custodian.
nalor511
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Re: In-Kind transfer noob questions

Post by nalor511 »

Collectingnuts wrote: Tue Nov 30, 2021 6:01 pm I am doing just the same as it turns out Dec 1st. What is the best way to capture the cost basis info? I have quite a few holdings to screen shot.
You just go to your cost basis page. Not that big a deal to do
KeepingEyesOpen
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Re: In-Kind transfer noob questions

Post by KeepingEyesOpen »

Collectingnuts wrote: Tue Nov 30, 2021 6:01 pm I am doing just the same as it turns out Dec 1st. What is the best way to capture the cost basis info? I have quite a few holdings to screen shot.
In the Vanguard portal, go to Balances and Holdings. Then (tediously :happy ) expand (click on) the cost basis specific ID or Lot Details for each holding. Did I mention tediously … for each holding … ? Then “Print” > “Save as PDF” this list of holdings with the expanded cost basis for each holding.

The Print > Save as PDF commands are for Safari in a Mac. Should be something equivalent in Windows.
delamer
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Re: In-Kind transfer noob questions

Post by delamer »

KeepingEyesOpen wrote: Tue Nov 30, 2021 6:13 pm
delamer wrote: Tue Nov 30, 2021 5:41 pm
Aside from the cost basis issue, is the process essentially the same for transferring a 401(k) [non- Vanguard] to Fidelity?

I assume I’d want to sell any institutional funds held in the 401(k) before intiating the transfer?
I would think that this would be a rollover from 401k to a an individual rollover IRA, correct?

You should ask the appropriate rollover IRA or transfer specialist at Fidelity regarding transfer of or holding of specific institutional funds at Fidelity.

I recently transferred a rollover IRA account and a trust brokerage account to Fidelity, described above, simple and easy. Years ago I did a rollover of a qualified employer pension plan to Fidelity. The procedures were similar, but not identical. Your 401K custodian may require some additional paperwork, maybe even notarized documents. Best to check with Fidelity and your 401K custodian.
Yes, I should have been more precise — it would a rollover of a 401(k) into an IRA.

Thanks.
One thing that humbles me deeply is to see that human genius has its limits while human stupidity does not. - Alexandre Dumas, fils
KeepingEyesOpen
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Joined: Sat Dec 12, 2015 9:49 pm

Re: In-Kind transfer noob questions

Post by KeepingEyesOpen »

delamer wrote: Tue Nov 30, 2021 9:54 pm
KeepingEyesOpen wrote: Tue Nov 30, 2021 6:13 pm
delamer wrote: Tue Nov 30, 2021 5:41 pm
Aside from the cost basis issue, is the process essentially the same for transferring a 401(k) [non- Vanguard] to Fidelity?

I assume I’d want to sell any institutional funds held in the 401(k) before intiating the transfer?
I would think that this would be a rollover from 401k to a an individual rollover IRA, correct?

You should ask the appropriate rollover IRA or transfer specialist at Fidelity regarding transfer of or holding of specific institutional funds at Fidelity.

... Your 401K custodian may require some additional paperwork, maybe even notarized documents. Best to check with Fidelity and your 401K custodian.
Yes, I should have been more precise — it would a rollover of a 401(k) into an IRA.

Thanks.
After thinking this over a bit, I now recall that some of my old rollover transactions from employer plans required extra work. Back in the 2005 time frame I had several accounts in a self-directed qualified Money Purchase Pension Plan and Profit Sharing Plan - similar administratively to a 401K - held at various mutual fund companies. These included Franklin Templeton Mutual Series Funds, Oakmark, Columbia Acorn Fund, and maybe one or two others. At least two of these required a Medallion Signature Guarantee on their transfer authorization forms in order to complete the rollover to either Vanguard or Fidelity.

I was this experience that convinced me to simplify my life and consolidate these many accounts at Vanguard and Fidelity. Keeping track of all of the statements and obtaining the medallion signature guarantees were onerous.

But it gets even worse. One of the mutual fund companies (I think it was Oakmark, but not sure), managed to co-mingle my funds with those of one of my professional partners, since our "segregated" accounts were identified by the same employer Tax ID Number. The mutual fund company transferred not only my shares, but those of my partner, to Fidelity. Fortunately, I was watching this closely, identified the problem and had it corrected quickly.

This experience really drove the point home to keep financial affairs as simple as possible and to avoid collecting numerous financial accounts.

I also learned to avoid actively-managed (and expensive) mutual funds. I wish I had been exposed to the Bogleheads forum back then. All is well now, but I learned many lessons the hard way.
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