Schwab Information Thread with FAQ, Links, Tips and Q&A

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nalor511
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by nalor511 »

civiltoatee wrote: Thu Aug 26, 2021 7:45 am
Average Investor wrote: Wed Aug 25, 2021 11:55 pm
nalor511 wrote: Wed Aug 25, 2021 4:35 pm
RubyTuesday wrote: Wed Aug 25, 2021 4:27 pm
Average Investor wrote: Tue Aug 24, 2021 3:28 pm Just some data points for a pending asset move from Vanguard to Schwab. I was able to negotiate:

1. $3000 bonus.
2. Reimbursement of transfer fees.
3. Vanguard mutual fund fee waiver.
4. PAL loan at 1.25% over SOFR.
Btw, would you mind sharing rough size of portfolio transferring and PAL limit?
I'm guessing $1mil, because 2-4 seem right for $1mil, #1 seems a little low, but could be a no haggle offer if the other points were more important
;—)
This thread has been extremely helpful in clarifying what Schwab can typically provide and I want to thank all those that have participated.

I have been reviewing advertised bonus offers from other brokers and the typical bonus for $1M-$2M is $2000 and a $3000 bonus is for amounts greater than $2M. There seems to be the implication in these recent posts that a $3000 bonus can be negotiated for amounts over $1M, but less than $2M. Is that the case or am I misreading something?
It's not that complicated. Find the best competitor offer - they will match it. That's it. Can you find a competitor offering more than $3k for $1m? Takes about 10 seconds.

It doesn't matter what the "average" offer is, it just matters what the best offer is, then you ask them to match it.
Average Investor
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Average Investor »

galawdawg wrote: Thu Aug 26, 2021 8:11 am
civiltoatee wrote: Thu Aug 26, 2021 7:45 am This thread has been extremely helpful in clarifying what Schwab can typically provide and I want to thank all those that have participated.

I have been reviewing advertised bonus offers from other brokers and the typical bonus for $1M-$2M is $2000 and a $3000 bonus is for amounts greater than $2M. There seems to be the implication in these recent posts that a $3000 bonus can be negotiated for amounts over $1M, but less than $2M. Is that the case or am I misreading something?
If you'll take a look at my post on the first page on how Schwab is likely (based upon past experience) to calculate the bonus among several accounts, you can see that you can get to $3k with a portfolio of well under $2m.

For example, if you have $1.1m in an IRA and $550k in a taxable account and if Schwab matches Ally's current offer, you are likely to receive $2k for the IRA and $1,200 for the taxable account....$3,200 in bonus payments for a total portfolio of $1.6m. Of course, YMMV, so you would want to speak with a financial consultant at an office near you to see exactly what they can offer you.
This.

In the end I was able to get an even larger bonus than posted earlier by moving over more accounts. Schwab clearly wants the business.

Thank you again for creating this thread!
Tomorrow never knows.
RubyTuesday
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by RubyTuesday »

Any info for the Schwab FAQ on 2FA security, use of hardware tokens, or use of TOTP authenticators?

I’ve just set up an account (not funded yet) and don’t see any 2FA other than simple SMS. Hoping to find out they will support Yubico or authenticator apps.
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Average Investor
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Average Investor »

RubyTuesday wrote: Thu Aug 26, 2021 6:31 pm Any info for the Schwab FAQ on 2FA security, use of hardware tokens, or use of TOTP authenticators?

I’ve just set up an account (not funded yet) and don’t see any 2FA other than simple SMS. Hoping to find out they will support Yubico or authenticator apps.
Symantec authenticator works, I use it. Hardware authentication also supported based on online info.
Tomorrow never knows.
RubyTuesday
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by RubyTuesday »

Thanks galawdawg and Average Investor.

Looks like I’ll be able to get over $5k in bonuses total across 3-5 accounts (joint and 2-4 IRAs depending on what we transfer). Still awaiting exact confirmation for each account.

Also no issue waiving transaction fees on VG funds and any transfer fees (don’t believe VG charges transfer fees though).

And regarding PAL, it’s taking a couple of weeks now to get approval of a competitive rate through Schwab’s bank, so the Advisor was able to offer a brokerage margin rate of FFR + 1.05% (effectively 1.3% currently). That’s close enough to the 1.25% others got on PAL and only slightly worse than blended effective rate 1.15 at IBKR.

I’ll likely go through with the transfer.

I’m considering doing tax free conversion to ETF at VG rather than keeping the mutual fund shares. Just wondering if this will end up being easier to deal with at Schwab with margin, even though Schwab is waiving transaction fees. I don’t mind buying/selling ETFs and since I’m retired, I’m not reinvesting dividends in taxable account anyway. Not sure there’s any advantage to remaining in MFs.

Thoughts on this?
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foosball
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by foosball »

RubyTuesday wrote: Fri Aug 27, 2021 11:12 am <snip>
I’m considering doing tax free conversion to ETF at VG rather than keeping the mutual fund shares. Just wondering if this will end up being easier to deal with at Schwab with margin, even though Schwab is waiving transaction fees. I don’t mind buying/selling ETFs and since I’m retired, I’m not reinvesting dividends in taxable account anyway. Not sure there’s any advantage to remaining in MFs.

Thoughts on this?
I've come to prefer the ETF wrapper versus mutual funds. I called and made the share class conversion to ETFs at Vanguard and it was painless. I'd recommend doing it to get the easy portability benefits of ETFs if a) your funds are eligible for a share class conversion and b) you are comfortable buying and selling ETFs. If you're uncomfortable, there is ample guidance on this forum, and I'd bet people would be willing to answer your specific questions.
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Average Investor »

RubyTuesday wrote: Fri Aug 27, 2021 11:12 am Thanks galawdawg and Average Investor.

Looks like I’ll be able to get over $5k in bonuses total across 3-5 accounts (joint and 2-4 IRAs depending on what we transfer). Still awaiting exact confirmation for each account.

Also no issue waiving transaction fees on VG funds and any transfer fees (don’t believe VG charges transfer fees though).

And regarding PAL, it’s taking a couple of weeks now to get approval of a competitive rate through Schwab’s bank, so the Advisor was able to offer a brokerage margin rate of FFR + 1.05% (effectively 1.3% currently). That’s close enough to the 1.25% others got on PAL and only slightly worse than blended effective rate 1.15 at IBKR.

I’ll likely go through with the transfer.

I’m considering doing tax free conversion to ETF at VG rather than keeping the mutual fund shares. Just wondering if this will end up being easier to deal with at Schwab with margin, even though Schwab is waiving transaction fees. I don’t mind buying/selling ETFs and since I’m retired, I’m not reinvesting dividends in taxable account anyway. Not sure there’s any advantage to remaining in MFs.

Thoughts on this?
Great job.

For clarity, the PAL rate I received was 1.25% over SOFR, currently 1.3%.

I’m keeping my mutual fund shares for now. I made some etf transactions in another account and out of carelessness it cost me some on price (only about $14 on the trade but it still stung). Can’t happen with mutual funds, one less thing for me to worry about. YMMV.
Tomorrow never knows.
earlyretire
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by earlyretire »

I have one more question! Sorry, and I appreciate the patience! :)

I have the 3 fund portfolio: VTSAX, VTIAX, and VBTLX. If I keep my admiral shares and transfer to Schwab, how do I buy new shares? Do I start over with ETFs?
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by galawdawg »

earlyretire wrote: Sat Aug 28, 2021 7:15 am I have one more question! Sorry, and I appreciate the patience! :)

I have the 3 fund portfolio: VTSAX, VTIAX, and VBTLX. If I keep my admiral shares and transfer to Schwab, how do I buy new shares? Do I start over with ETFs?
If you qualify for a waiver of mutual fund transaction fees on one fund family and select Vanguard (see the FAQ in the second post), you can simply just invest in those same three mutual funds, they are all available at Schwab.

If you don't qualify for a transaction fee waiver, you can either use the ETF versions (VTI, VXUS and BND) or as noted in the Bogleheads wiki, you can use Schwab mutual funds. The Schwab versions would be SWTSX, SWISX and SWAGX.

Note, however, that SWISX (Schwab International Index) does not include emerging markets, so you if you use the Schwab mutual funds, you may wish to add some SFENX (maybe 30%-50% of your international allocation) if you want emerging market exposure in your portfolio. So if you are currently 60% VTSAX, 20% VTIAX and 20% VBTLX, with Schwab mutual funds you may wish to have 60% SWTSX, 15% SWISX, 5% SFENX and 20% SWAGX.

The easiest option would be to stick with VTSAX, VTIAX and VBTLX with a waiver of the transaction fees. If you don't have a fee waiver, then the ETFs would be the next simplest, followed by the Schwab mutual funds which is a little more complex with four funds instead of three.

Also, if you don't qualify for the transaction fee waiver and haven't yet switched to Schwab, you may wish to have Vanguard convert your three mutual fund holdings to the equivalent ETFs and then transfer in-kind. That keeps your portfolio simple...VTI, VXUS and BND.

Hope that helps!
RubyTuesday
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by RubyTuesday »

galawdawg wrote: Sat Aug 28, 2021 7:33 am
earlyretire wrote: Sat Aug 28, 2021 7:15 am I have one more question! Sorry, and I appreciate the patience! :)

I have the 3 fund portfolio: VTSAX, VTIAX, and VBTLX. If I keep my admiral shares and transfer to Schwab, how do I buy new shares? Do I start over with ETFs?
If you qualify for a waiver of mutual fund transaction fees on one fund family and select Vanguard (see the FAQ in the second post), you can simply just invest in those same three mutual funds, they are all available at Schwab.

If you don't qualify for a transaction fee waiver, you can either use the ETF versions (VTI, VXUS and BND) or as noted in the Bogleheads wiki, you can use Schwab mutual funds. The Schwab versions would be SWTSX, SWISX and SWAGX.

Note, however, that SWISX (Schwab International Index) does not include emerging markets, so you if you use the Schwab mutual funds, you may wish to add some SFENX (maybe 30%-50% of your international allocation) if you want emerging market exposure in your portfolio. So if you are currently 60% VTSAX, 20% VTIAX and 20% VBTLX, with Schwab mutual funds you may wish to have 60% SWTSX, 15% SWISX, 5% SFENX and 20% SWAGX.

The easiest option would be to stick with VTSAX, VTIAX and VBTLX with a waiver of the transaction fees. If you don't have a fee waiver, then the ETFs would be the next simplest, followed by the Schwab mutual funds which is a little more complex with four funds instead of three.

Also, if you don't qualify for the transaction fee waiver and haven't yet switched to Schwab, you may wish to have Vanguard convert your three mutual fund holdings to the equivalent ETFs and then transfer in-kind. That keeps your portfolio simple...VTI, VXUS and BND.

Hope that helps!
Total Bond is one of 4 funds that have ETFs but that cannot be converted (tax free) to ETF at Vanguard and would require taxable event to switch (Total Bond Market, Short-Term Bond, Intermediate-Term Bond, and Long-Term Bond).

Reference
Can I convert my conventional Vanguard mutual fund shares to Vanguard ETF Shares?
Yes. Most funds that offer ETF Shares will allow you to convert from conventional shares of the same fund to ETF Shares. (Four of our bond ETFs—Total Bond Market, Short-Term Bond, Intermediate-Term Bond, and Long-Term Bond—don't allow for conversions.)
Conversions are allowed from both Investor and Admiral™ Shares and are tax-free if you own your mutual fund and ETF Shares through Vanguard.
Keep in mind that you can't convert ETF Shares back to conventional shares. If you decide in the future to sell your Vanguard ETF Shares and repurchase conventional shares, that transaction could be taxable.
If you have a brokerage account at Vanguard, there's no charge to convert conventional shares to ETF Shares. If you have questions, contact us.
If you own your Vanguard mutual fund shares through another broker, keep in mind that some brokers may not be able to convert fractional shares, which could result in a modest taxable gain for you. Other brokers may also charge a fee for a conversion. Contact your broker for more information.
When I read this last emphasized portion carefully it implies that you MAY be able to convert from MF to ETF at other brokerages (perhaps for a fee) with only fractional share liquidation causing taxable event. Am I reading this correctly? Something else to ask Schwab advisor!
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by galawdawg »

Thanks for that clarification on Vanguard being unable to convert VBTLX to BND, I wasn't aware of that!

One potential workaround is available if VBTLX is being held in a tax-advantaged account, which is simply to sell VBTLX and buy BND. Since BND has very little volatility, generally only fluctuating fractionally in value from day to day, time out of the market on such a transaction should be of little to no concern for most buy and hold investors.

Even in taxable, since VBTLX is slightly down for the year, some investors may incur no capital gains if VBTLX is sold and BND purchased in its stead. (The wash sale rule would likely disallow any loss which would instead be added to the cost-basis: https://www.schwab.com/resource-center/ ... wash-sales).

As far as Schwab being able to convert VG mutual funds to their ETF equivalent, that is something I am not familiar with. I'm sure that one's dedicated financial consultant can get that question answered correctly.
earlyretire
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by earlyretire »

galawdawg wrote: Sat Aug 28, 2021 7:33 am
earlyretire wrote: Sat Aug 28, 2021 7:15 am I have one more question! Sorry, and I appreciate the patience! :)

I have the 3 fund portfolio: VTSAX, VTIAX, and VBTLX. If I keep my admiral shares and transfer to Schwab, how do I buy new shares? Do I start over with ETFs?
If you qualify for a waiver of mutual fund transaction fees on one fund family and select Vanguard (see the FAQ in the second post), you can simply just invest in those same three mutual funds, they are all available at Schwab.

If you don't qualify for a transaction fee waiver, you can either use the ETF versions (VTI, VXUS and BND) or as noted in the Bogleheads wiki, you can use Schwab mutual funds. The Schwab versions would be SWTSX, SWISX and SWAGX.

Note, however, that SWISX (Schwab International Index) does not include emerging markets, so you if you use the Schwab mutual funds, you may wish to add some SFENX (maybe 30%-50% of your international allocation) if you want emerging market exposure in your portfolio. So if you are currently 60% VTSAX, 20% VTIAX and 20% VBTLX, with Schwab mutual funds you may wish to have 60% SWTSX, 15% SWISX, 5% SFENX and 20% SWAGX.

The easiest option would be to stick with VTSAX, VTIAX and VBTLX with a waiver of the transaction fees. If you don't have a fee waiver, then the ETFs would be the next simplest, followed by the Schwab mutual funds which is a little more complex with four funds instead of three.

Also, if you don't qualify for the transaction fee waiver and haven't yet switched to Schwab, you may wish to have Vanguard convert your three mutual fund holdings to the equivalent ETFs and then transfer in-kind. That keeps your portfolio simple...VTI, VXUS and BND.

Hope that helps!
Thanks so much! This helps! So, I am eligible for a Vanguard family fee waiver at Schwab. I guess the part I am not understanding is this - my Admiral shares will transfer in-kind from Vanguard to Schwab, correct? Now, I won't be able to add to these funds? So, I have to start over with Investor shares of the same funds?
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by RubyTuesday »

earlyretire wrote: Sat Aug 28, 2021 8:43 am
galawdawg wrote: Sat Aug 28, 2021 7:33 am
earlyretire wrote: Sat Aug 28, 2021 7:15 am I have one more question! Sorry, and I appreciate the patience! :)

I have the 3 fund portfolio: VTSAX, VTIAX, and VBTLX. If I keep my admiral shares and transfer to Schwab, how do I buy new shares? Do I start over with ETFs?
If you qualify for a waiver of mutual fund transaction fees on one fund family and select Vanguard (see the FAQ in the second post), you can simply just invest in those same three mutual funds, they are all available at Schwab.

If you don't qualify for a transaction fee waiver, you can either use the ETF versions (VTI, VXUS and BND) or as noted in the Bogleheads wiki, you can use Schwab mutual funds. The Schwab versions would be SWTSX, SWISX and SWAGX.

Note, however, that SWISX (Schwab International Index) does not include emerging markets, so you if you use the Schwab mutual funds, you may wish to add some SFENX (maybe 30%-50% of your international allocation) if you want emerging market exposure in your portfolio. So if you are currently 60% VTSAX, 20% VTIAX and 20% VBTLX, with Schwab mutual funds you may wish to have 60% SWTSX, 15% SWISX, 5% SFENX and 20% SWAGX.

The easiest option would be to stick with VTSAX, VTIAX and VBTLX with a waiver of the transaction fees. If you don't have a fee waiver, then the ETFs would be the next simplest, followed by the Schwab mutual funds which is a little more complex with four funds instead of three.

Also, if you don't qualify for the transaction fee waiver and haven't yet switched to Schwab, you may wish to have Vanguard convert your three mutual fund holdings to the equivalent ETFs and then transfer in-kind. That keeps your portfolio simple...VTI, VXUS and BND.

Hope that helps!
Thanks so much! This helps! So, I am eligible for a Vanguard family fee waiver at Schwab. I guess the part I am not understanding is this - my Admiral shares will transfer in-kind from Vanguard to Schwab, correct? Now, I won't be able to add to these funds? So, I have to start over with Investor shares of the same funds?
You should confirm, but I am fairly confident you can buy more of the admiral class (without fee if fees waived).
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sycamore
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by sycamore »

RubyTuesday wrote: Sat Aug 28, 2021 7:49 am ...
...
If you own your Vanguard mutual fund shares through another broker, keep in mind that some brokers may not be able to convert fractional shares, which could result in a modest taxable gain for you. Other brokers may also charge a fee for a conversion. Contact your broker for more information.
When I read this last emphasized portion carefully it implies that you MAY be able to convert from MF to ETF at other brokerages (perhaps for a fee) with only fractional share liquidation causing taxable event. Am I reading this correctly? Something else to ask Schwab advisor!
I think there may be some wishful thinking here 🙂 I've only heard of Vanguard being able to do the share class conversion, not other brokers.

But it's worth asking. Let us know what Schwab says.
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by galawdawg »

earlyretire wrote: Sat Aug 28, 2021 8:43 am Thanks so much! This helps! So, I am eligible for a Vanguard family fee waiver at Schwab. I guess the part I am not understanding is this - my Admiral shares will transfer in-kind from Vanguard to Schwab, correct? Now, I won't be able to add to these funds? So, I have to start over with Investor shares of the same funds?
The exact same funds you already have are available at Schwab. VTSAX, VTIAX and VBTLX. All Admiral class shares.

https://www.schwab.wallst.com/Prospect/ ... mbol=VTSAX
https://www.schwab.wallst.com/Prospect/ ... mbol=VTIAX
https://www.schwab.wallst.com/Prospect/ ... mbol=VBTLX

If Schwab waives your mutual fund transaction fees on Vanguard funds, then you can buy VTSAX, VTIAX and VBTLX (or any other VG mutual funds available at Schwab) with no fees or additional costs...

So if you want to keep those mutual funds, just transfer them "in-kind" from VG and you can buy more whenever you wish!

Your Schwab financial consultant can set up the fee waiver for VG mutual funds and walk you through the transfer "in-kind" process if you need any help with that. Don't forget to ask for a new account bonus! :beer
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by jeffyscott »

galawdawg wrote: Sat Aug 28, 2021 8:02 amOne potential workaround is available if VBTLX is being held in a tax-advantaged account, which is simply to sell VBTLX and buy BND.
Of course, in tax-advantaged, another option would be to just switch to the Schwab bond index fund. I think the ER differences are insignificant, but SWAGX is lower than VBTLX and higher than BND. The same for equity index funds, in tax advantaged there is nothing that prevents switching to the Schwab mutual funds (other than the lack of a cap-weighted EM mutual fund).
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by earlyretire »

galawdawg wrote: Sat Aug 28, 2021 9:22 am
earlyretire wrote: Sat Aug 28, 2021 8:43 am Thanks so much! This helps! So, I am eligible for a Vanguard family fee waiver at Schwab. I guess the part I am not understanding is this - my Admiral shares will transfer in-kind from Vanguard to Schwab, correct? Now, I won't be able to add to these funds? So, I have to start over with Investor shares of the same funds?
The exact same funds you already have are available at Schwab. VTSAX, VTIAX and VBTLX. All Admiral class shares.

https://www.schwab.wallst.com/Prospect/ ... mbol=VTSAX
https://www.schwab.wallst.com/Prospect/ ... mbol=VTIAX
https://www.schwab.wallst.com/Prospect/ ... mbol=VBTLX

If Schwab waives your mutual fund transaction fees on Vanguard funds, then you can buy VTSAX, VTIAX and VBTLX (or any other VG mutual funds available at Schwab) with no fees or additional costs...

So if you want to keep those mutual funds, just transfer them "in-kind" from VG and you can buy more whenever you wish!

Your Schwab financial consultant can set up the fee waiver for VG mutual funds and walk you through the transfer "in-kind" process if you need any help with that. Don't forget to ask for a new account bonus! :beer
You are awesome! Thank you! I was reading other posts that stated you cannot buy Vanguard Admiral shares at other brokerage houses - Vanguard had stopped it a couple of years ago. So, I was confused!
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by galawdawg »

earlyretire wrote: Sat Aug 28, 2021 12:02 pm You are awesome! Thank you! I was reading other posts that stated you cannot buy Vanguard Admiral shares at other brokerage houses - Vanguard had stopped it a couple of years ago. So, I was confused!
My pleasure. Most Vanguard Admiral share mutual funds are now available to purchase at many brokerages, not just Schwab. The funds that have limited availability appear to be the municipal bond funds and some of the actively managed funds (such as Wellesley and Wellington).
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by jeffyscott »

galawdawg wrote: Mon Aug 30, 2021 7:18 am
earlyretire wrote: Sat Aug 28, 2021 12:02 pm You are awesome! Thank you! I was reading other posts that stated you cannot buy Vanguard Admiral shares at other brokerage houses - Vanguard had stopped it a couple of years ago. So, I was confused!
My pleasure. Most Vanguard Admiral share mutual funds are now available to purchase at many brokerages, not just Schwab. The funds that have limited availability appear to be the municipal bond funds and some of the actively managed funds (such as Wellesley and Wellington).
I think it is pretty much just that, active funds' admiral shares are not available for purchase elsewhere, but index admiral shares are (the munu funds are active).

This is because Vanguard made the index admiral shares the only share class available to individuals. The investor share class of those is now only used for funds of funds (like life strategy and target date) and "certain retirement plan clients".
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Barefootgirl »

I recall reading somewhere that it's beneficial, when moving assets from Vanguard over to a new brokerage, to move the equities in ETFs. vs. mutual funds?

Can someone explain this to me? Thanks
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by jeffyscott »

Barefootgirl wrote: Mon Sep 06, 2021 6:18 am I recall reading somewhere that it's beneficial, when moving assets from Vanguard over to a new brokerage, to move the equities in ETFs. vs. mutual funds?

Can someone explain this to me? Thanks
It's about transaction fees. But at Schwab there's no fees to sell and there may be waivers available for purchases, as covered in the second post in the discussion. Also, if there's an equivalent Schwab fund, that could be used for new purchases, to avoid any transaction fees.

Some may also convert, particularly in a taxable account, before moving because it can only be done at Vanguard. Any future desire to convert, for whatever reason, would require moving back to vanguard.
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by mkc »

A post in another topic raised a question for me. That poster mentioned having to convert a Vanguard MF account to brokerage in order to move to Fidelity, otherwise they needed to liquidate (and incur potential cap gains).

Does anyone know if this is also the case for moving from VG to Schwab? Do the funds need to be held in the brokerage side of VG in order to be transferred in kind to Schwab?

(we have avoided conversion from MF to brokerage account at VG).
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by tj »

mkc wrote: Thu Sep 09, 2021 9:05 pm A post in another topic raised a question for me. That poster mentioned having to convert a Vanguard MF account to brokerage in order to move to Fidelity, otherwise they needed to liquidate (and incur potential cap gains).

Does anyone know if this is also the case for moving from VG to Schwab? Do the funds need to be held in the brokerage side of VG in order to be transferred in kind to Schwab?

(we have avoided conversion from MF to brokerage account at VG).

No, you can transfer yout mutual funds to Schwab or Fidelity, you just might have transaction fees to buy more or sell.
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by mkc »

tj wrote: Thu Sep 09, 2021 9:34 pm
mkc wrote: Thu Sep 09, 2021 9:05 pm A post in another topic raised a question for me. That poster mentioned having to convert a Vanguard MF account to brokerage in order to move to Fidelity, otherwise they needed to liquidate (and incur potential cap gains).

Does anyone know if this is also the case for moving from VG to Schwab? Do the funds need to be held in the brokerage side of VG in order to be transferred in kind to Schwab?

(we have avoided conversion from MF to brokerage account at VG).

No, you can transfer yout mutual funds to Schwab or Fidelity, you just might have transaction fees to buy more or sell.
I had thought that, but here's a link to the post where the person stated they had to liquidate if the holdings were in a VG MF account rather than a VG brokerage account (in this case it was a transfer to Fidelity)

viewtopic.php?p=6218463#p6218463
Adding insult to injury is the transfer of assets process for the old mutual fund accounts. They incur a taxable event since the funds have to be sold. With the Brokerage account, it's a non-taxable event, but you have to keep good records of cost basis because of the rounding issues. To get my funds out, I had to convert the old accounts to new ones, and *then* transfer assets.
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jeffyscott
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by jeffyscott »

mkc wrote: Fri Sep 10, 2021 8:20 am
tj wrote: Thu Sep 09, 2021 9:34 pm
mkc wrote: Thu Sep 09, 2021 9:05 pm A post in another topic raised a question for me. That poster mentioned having to convert a Vanguard MF account to brokerage in order to move to Fidelity, otherwise they needed to liquidate (and incur potential cap gains).

Does anyone know if this is also the case for moving from VG to Schwab? Do the funds need to be held in the brokerage side of VG in order to be transferred in kind to Schwab?

(we have avoided conversion from MF to brokerage account at VG).

No, you can transfer yout mutual funds to Schwab or Fidelity, you just might have transaction fees to buy more or sell.
I had thought that, but here's a link to the post where the person stated they had to liquidate if the holdings were in a VG MF account rather than a VG brokerage account (in this case it was a transfer to Fidelity)

viewtopic.php?p=6218463#p6218463
Adding insult to injury is the transfer of assets process for the old mutual fund accounts. They incur a taxable event since the funds have to be sold. With the Brokerage account, it's a non-taxable event, but you have to keep good records of cost basis because of the rounding issues. To get my funds out, I had to convert the old accounts to new ones, and *then* transfer assets.
I don't know about Vanguard, but mutual fund account from T. Rowe was able to be transferred to Schwab.

I had actually thought it would need to be a brokerage account to transfer in-kind, but our Schwab rep informed me that was not the case.
Random Poster
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Random Poster »

Haven’t seen this asked before, but apologies if it has:

Does Schwab provide a Foreign Tax Paid statement for Vanguard International funds or ETFs?

Vanguard seems to have stopped providing them for those on the mutual fund platform, which I find to be extremely annoying.

Curious if Schwab provides them, even for funds/ETFs that are issued by one of its competitors.
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by adzio »

My first post on the forum. Thanks galawdawg et al. for the valuable advice here. I look forward to learning from y'all.

Decided to start doing business with Schwab based on the positive comments posted on this forum. Opened a brokerage account with them last week and got connected with a dedicated financial consultant. Funded the account this past Friday, was told the funds should be available within 7 calendar days.
Requested Vanguard mutual fund fee waiver, and received it. I've also asked Schwab to match the current Citi bonus offer (https://banking.citi.com/cbol/investmen ... .htm?BT_TX), and got that too. Very smooth process so far - I look forward to index fund investing.
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Random Poster
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Random Poster »

One more question about transferring from Vanguard to Schwab:

I own five mutual funds at Vanguard, all of them Admiral class: Total Stock Market Index; Large Cap Index; FTSE All-World ex-US Index; Intermediate-Term Tax Exempt; and Total Bond Market. All but the latter are held in a taxable mutual fund account; the Total Bond Market fund is the only holding in the IRAs.

It looks like Schwab currently offers all of these funds in Admiral class, except for the Intermediate-Term Tax Exempt, which is offered in the Investor class.

So if I were to transfer everything from Vanguard to Schwab, what happens to the Intermediate-Term Tax Exempt Admiral holding?

Does it get downgraded to the Investor class, and, if so, would that even be an issue or concern? It looks to me like the share price is the same for the Admiral and Investor class, so would I even notice anything anyway?

Thanks.
RubyTuesday
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by RubyTuesday »

Quick update on my (partial) transfer to Schwab.

Everything is going very well!

To start the process I researched local Schwab advisors and found a local advisor who holds CFA (and isn’t an insurance guy). He has been super responsive, including providing tickets to a PGA event after noting that I enjoy golf.

So I setup 3 accounts online (no physical paperwork), comprising joint taxable, tradtional and Roth IRAs.

They agreed to match other firm’s bonus offer, they gave a 1.3% margin rate and waived fees for Vanguard mutual fund purchases.

The offer they matched only allowed one bonus per account owner, but they were willing to count joint account as DWs and then aggregate the values of IRAs for me for higher tier bonus.

I only moved enough taxable assets to get the top tier bonus on the joint ($3500 bonus based on matching eTrade). This required $1M+ in assets.

The two IRAs combined were in the $1800 bonus tier ($500k+ assets).

So total we will get $5300 for moving just over $1.5M. Thats about 35 basis points just for doing ACATS transfer and no changes to portfolio.

We may move the rest of our assets later this year if things continue going well. Hopefully be able to get another bonus at that time if other firms are offering bonuses to existing clients!

The ACATS transfer went through flawlessly in less than a week, including correct basis about a day after assets moved.

The advisor checked in multiple times by phone and email to confirm where things stood. Once the assets had transferred he called again to confirm bonuses and see if I had any questions. When he called, there was a mistake on the bonus amount for the IRAs. I pointed out it should be $1800 not $1000. He called back next day to confirm it was corrected.

Very good customer service so far.
“Doing nothing is better than being busy doing nothing.” – Lao Tzu
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Nate79
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Nate79 »

Random Poster wrote: Sun Sep 12, 2021 6:16 pm One more question about transferring from Vanguard to Schwab:

I own five mutual funds at Vanguard, all of them Admiral class: Total Stock Market Index; Large Cap Index; FTSE All-World ex-US Index; Intermediate-Term Tax Exempt; and Total Bond Market. All but the latter are held in a taxable mutual fund account; the Total Bond Market fund is the only holding in the IRAs.

It looks like Schwab currently offers all of these funds in Admiral class, except for the Intermediate-Term Tax Exempt, which is offered in the Investor class.

So if I were to transfer everything from Vanguard to Schwab, what happens to the Intermediate-Term Tax Exempt Admiral holding?

Does it get downgraded to the Investor class, and, if so, would that even be an issue or concern? It looks to me like the share price is the same for the Admiral and Investor class, so would I even notice anything anyway?

Thanks.
Contact Schwab and ask them. Report back with the info to help others who may have your same issue in the future.
Random Poster
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Random Poster »

Nate79 wrote: Thu Sep 16, 2021 12:11 pm
Contact Schwab and ask them. Report back with the info to help others who may have your same issue in the future.
I am sorta ambivalent about transferring anything to Schwab (or to any other broker) at the moment for various reasons (don’t want to convert to ETFs, not wild about Schwab’s money market offerings, a few comments here about the reps being too polished, etc), so I don’t really want to start a conversation with them and ultimately just end up wasting their time.
increment
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by increment »

Random Poster wrote: Sun Sep 12, 2021 6:16 pm It looks like Schwab currently offers all of these funds in Admiral class, except for the Intermediate-Term Tax Exempt, which is offered in the Investor class.

So if I were to transfer everything from Vanguard to Schwab, what happens to the Intermediate-Term Tax Exempt Admiral holding?
I would guess that Schwab wouldn't take it and it would be left behind at Vanguard. (I wonder, would Vanguard convert it to Investor class if you ask first?)
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jeffyscott
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by jeffyscott »

increment wrote: Thu Sep 16, 2021 12:58 pm
Random Poster wrote: Sun Sep 12, 2021 6:16 pm It looks like Schwab currently offers all of these funds in Admiral class, except for the Intermediate-Term Tax Exempt, which is offered in the Investor class.

So if I were to transfer everything from Vanguard to Schwab, what happens to the Intermediate-Term Tax Exempt Admiral holding?
I would guess that Schwab wouldn't take it and it would be left behind at Vanguard. (I wonder, would Vanguard convert it to Investor class if you ask first?)
It is available to institutional clients only, according to this: https://www.schwab.com/research/mutual- ... fees/vwiux

I have no direct experience, but others have said that such funds (managed fund admiral share class) will transfer to Schwab, but you will not be able to buy more.
nalor511
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by nalor511 »

Random Poster wrote: Thu Sep 16, 2021 12:46 pm
Nate79 wrote: Thu Sep 16, 2021 12:11 pm
Contact Schwab and ask them. Report back with the info to help others who may have your same issue in the future.
I am sorta ambivalent about transferring anything to Schwab (or to any other broker) at the moment for various reasons (don’t want to convert to ETFs, not wild about Schwab’s money market offerings, a few comments here about the reps being too polished, etc), so I don’t really want to start a conversation with them and ultimately just end up wasting their time.
I also was very hesitant about Schwab, and I prefer Fidelity because they are very direct and don't beat around the bush, but Schwab has the flexibility to do certain things Fidelity does not (e.g. fee waivers on VG Admiral shares).

In the end I split my funds between them, got a nice bonus from each, and get to enjoy the pros of each broker. I do not miss a single thing after leaving VG. Don't worry about "wasting their time", that is exactly what they are there for, to try to get you to bring money over and increase their AUM, they are being paid for their time.
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by sycamore »

Every time I login to my Schwab account it shows me an ad/banner message like "53 different ETFs, 20 asset classes, diversified portfolios, professionally managed for just $5000 to start. Get the facts."

I dismiss each of them. But after switching to another tab and back to the Summary tab, I'll sometimes see the same ad or a new one like "Automated investing for your IRA? Consider managing your IRA with Schwab Intelligent Portfolios. See How."

After logging out and back in, an advertisement shows up again. The Balances tab always seems to have a tab even in the same session.

There's nothing in my Schwab profile/settings to turn off ads. I opened an online chat with a Schwab customer service rep who investigated and said there's no way to turn them off permanently. Seems like the Vanguard PAS ad situation, alas.

If you're looking for an ad-free experience on your broker's web site, keep looking.
nalor511
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by nalor511 »

sycamore wrote: Thu Sep 16, 2021 2:52 pm Every time I login to my Schwab account it shows me an ad/banner message like "53 different ETFs, 20 asset classes, diversified portfolios, professionally managed for just $5000 to start. Get the facts."

I dismiss each of them. But after switching to another tab and back to the Summary tab, I'll sometimes see the same ad or a new one like "Automated investing for your IRA? Consider managing your IRA with Schwab Intelligent Portfolios. See How."

After logging out and back in, an advertisement shows up again. The Balances tab always seems to have a tab even in the same session.

There's nothing in my Schwab profile/settings to turn off ads. I opened an online chat with a Schwab customer service rep who investigated and said there's no way to turn them off permanently. Seems like the Vanguard PAS ad situation, alas.

If you're looking for an ad-free experience on your broker's web site, keep looking.
Meh I can live with a few ads for a year for the bonus they gave me ($3800). No ads on the mobile app.
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BigFoot48
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by BigFoot48 »

Has this news been posted? (Didn't see it.)

"After years of fee wars with other brokers, Charles Schwab is pushing back. Starting on Nov. 1, the cost for retail investors to buy Vanguard, Fidelity, and Dodge & Cox funds at the broker will rise from $49.95 to $74.95—a 50% increase. Similarly, at TD Ameritrade, which Schwab acquired in October 2020, prices for the same fund families will rise from $49.99 to $74.95 on Oct. 1.

Schwab’s stated reason for this shift is covering its record-keeping and other administrative costs. “The majority of mutual fund families pay Schwab/TD..."
https://www.barrons.com/articles/schwab ... 1631785500
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wycherly
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by wycherly »

BigFoot48 wrote: Thu Sep 16, 2021 6:50 pm Has this news been posted? (Didn't see it.)

"After years of fee wars with other brokers, Charles Schwab is pushing back. Starting on Nov. 1, the cost for retail investors to buy Vanguard, Fidelity, and Dodge & Cox funds at the broker will rise from $49.95 to $74.95—a 50% increase. Similarly, at TD Ameritrade, which Schwab acquired in October 2020, prices for the same fund families will rise from $49.99 to $74.95 on Oct. 1.

Schwab’s stated reason for this shift is covering its record-keeping and other administrative costs. “The majority of mutual fund families pay Schwab/TD..."
https://www.barrons.com/articles/schwab ... 1631785500
Yes, here's the thread: viewtopic.php?f=10&t=357283
tj
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by tj »

A user at E-R.org has recently been offered "Wealth Services" which seems to be free, no info on this service can be found at Schwab's website.

https://www.early-retirement.org/forums ... 10918.html
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by reisner »

I recently moved my Vanguard funds to Schwab and couldn't be happier. Vanguard customer service involved long holds, a variety of bored agents (actually yawning into the phone), and general incompetence. Schwab has been available, courteous, and efficient. I was expecting a bonus of $500 for shifting, but received $1000, perhaps because I moved both a Roth and a joint brokerage account. I didn't question it.
manlymatt83
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by manlymatt83 »

reisner wrote: Fri Sep 17, 2021 9:42 am I recently moved my Vanguard funds to Schwab and couldn't be happier. Vanguard customer service involved long holds, a variety of bored agents (actually yawning into the phone), and general incompetence. Schwab has been available, courteous, and efficient. I was expecting a bonus of $500 for shifting, but received $1000, perhaps because I moved both a Roth and a joint brokerage account. I didn't question it.
Will you be paying $79 to purchase?
reisner
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by reisner »

I moved 1.2 million. I don't think I would be charged to purchase. But it really doesn't matter. We bought these VG funds at the start of 2010, when already retired. I haven't bought anything since then, just skimmed off a little of the cream to supplement pension and taking SS at 66 in 2011.
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by drzzzzz »

manlymatt83 wrote: Fri Sep 17, 2021 7:44 pm
reisner wrote: Fri Sep 17, 2021 9:42 am I recently moved my Vanguard funds to Schwab and couldn't be happier. Vanguard customer service involved long holds, a variety of bored agents (actually yawning into the phone), and general incompetence. Schwab has been available, courteous, and efficient. I was expecting a bonus of $500 for shifting, but received $1000, perhaps because I moved both a Roth and a joint brokerage account. I didn't question it.
Will you be paying $79 to purchase?
I don't get why folks are so focused on purchasing Vanguard funds at Schwab or Fidelity and paying for that privilege. Just purchase ETFs of the Vanguard funds or ETFs from other providers since each of the companies have funds that are comparable to Vanguards. I would rather have $1000 and purchase other companies mutual funds than continue to insist that one is married to Vanguard's mutual funds. At one time they were more special, but now each of the large firms has a fund that mirrors the basic Vanguard mutual funds that most BH invest in. And if you are really married to a particular Vanguard fund that you want to continue to purchase, just leave that fund at Vanguard and continue to do that.
manlymatt83
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by manlymatt83 »

drzzzzz wrote: Fri Sep 17, 2021 9:21 pm
manlymatt83 wrote: Fri Sep 17, 2021 7:44 pm
reisner wrote: Fri Sep 17, 2021 9:42 am I recently moved my Vanguard funds to Schwab and couldn't be happier. Vanguard customer service involved long holds, a variety of bored agents (actually yawning into the phone), and general incompetence. Schwab has been available, courteous, and efficient. I was expecting a bonus of $500 for shifting, but received $1000, perhaps because I moved both a Roth and a joint brokerage account. I didn't question it.
Will you be paying $79 to purchase?
I don't get why folks are so focused on purchasing Vanguard funds at Schwab or Fidelity and paying for that privilege. Just purchase ETFs of the Vanguard funds or ETFs from other providers since each of the companies have funds that are comparable to Vanguards. I would rather have $1000 and purchase other companies mutual funds than continue to insist that one is married to Vanguard's mutual funds. At one time they were more special, but now each of the large firms has a fund that mirrors the basic Vanguard mutual funds that most BH invest in. And if you are really married to a particular Vanguard fund that you want to continue to purchase, just leave that fund at Vanguard and continue to do that.
I would love to buy SWISX instead of VTIAX… but the two aren’t even close.

No Canada. No emerging markets.
reisner
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by reisner »

Funny, back when we got some money, from a sale of our house in San Diego, I invested heavily and ignorantly in Fidelity Canada and Latin America. Those 45% gains supported us for a few years, until I became woke at about the time they began to tank. Still have a soft spot, but not a dime for them.
Last edited by reisner on Fri Sep 17, 2021 11:57 pm, edited 1 time in total.
nalor511
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by nalor511 »

manlymatt83 wrote: Fri Sep 17, 2021 10:08 pm
drzzzzz wrote: Fri Sep 17, 2021 9:21 pm
manlymatt83 wrote: Fri Sep 17, 2021 7:44 pm
reisner wrote: Fri Sep 17, 2021 9:42 am I recently moved my Vanguard funds to Schwab and couldn't be happier. Vanguard customer service involved long holds, a variety of bored agents (actually yawning into the phone), and general incompetence. Schwab has been available, courteous, and efficient. I was expecting a bonus of $500 for shifting, but received $1000, perhaps because I moved both a Roth and a joint brokerage account. I didn't question it.
Will you be paying $79 to purchase?
I don't get why folks are so focused on purchasing Vanguard funds at Schwab or Fidelity and paying for that privilege. Just purchase ETFs of the Vanguard funds or ETFs from other providers since each of the companies have funds that are comparable to Vanguards. I would rather have $1000 and purchase other companies mutual funds than continue to insist that one is married to Vanguard's mutual funds. At one time they were more special, but now each of the large firms has a fund that mirrors the basic Vanguard mutual funds that most BH invest in. And if you are really married to a particular Vanguard fund that you want to continue to purchase, just leave that fund at Vanguard and continue to do that.
I would love to buy SWISX instead of VTIAX… but the two aren’t even close.

No Canada. No emerging markets.
Focus. Buy VXUS. it's the same.
Barefootgirl
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Barefootgirl »

Barefootgirl wrote: ↑Mon Sep 06, 2021 7:18 am
I recall reading somewhere that it's beneficial, when moving assets from Vanguard over to a new brokerage, to move the equities in ETFs. vs. mutual funds?

Can someone explain this to me? Thanks

It's about transaction fees. But at Schwab there's no fees to sell and there may be waivers available for purchases, as covered in the second post in the discussion. Also, if there's an equivalent Schwab fund, that could be used for new purchases, to avoid any transaction fees.

Some may also convert, particularly in a taxable account, before moving because it can only be done at Vanguard. Any future desire to convert, for whatever reason, would require moving back to vanguard.


I am preparing to make an account transfer to Schwab from Vanguard. I apologize for this ignorant question, but it appears my best move is to convert some of my Vanguard Mutual Funds to Vanguard ETFs prior to the transfer so Schwab.

If I convert the Vanguard fund to an equivalent ETF, is this not a taxable event? I would think I would first have to sell the Fund before buying the ETF? Thank you.
How many retired people does it take to screw in a lightbulb? Only one, but he takes all day.
increment
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by increment »

Barefootgirl wrote: Sun Sep 26, 2021 2:51 pm [...] it appears my best move is to convert some of my Vanguard Mutual Funds to Vanguard ETFs prior to the transfer so Schwab.

If I convert the Vanguard fund to an equivalent ETF, is this not a taxable event?
Vanguard says, "Conversions are allowed from both Investor and Admiral™ Shares and are tax-free if you own your mutual fund and ETF Shares through Vanguard." The word here is that you will need to call to request the conversion.
sycamore
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by sycamore »

increment wrote: Sun Sep 26, 2021 3:03 pm
Barefootgirl wrote: Sun Sep 26, 2021 2:51 pm [...] it appears my best move is to convert some of my Vanguard Mutual Funds to Vanguard ETFs prior to the transfer so Schwab.

If I convert the Vanguard fund to an equivalent ETF, is this not a taxable event?
Vanguard says, "Conversions are allowed from both Investor and Admiral™ Shares and are tax-free if you own your mutual fund and ETF Shares through Vanguard." The word here is that you will need to call to request the conversion.
+1

It's merely a "share class conversion," just like when you could convert from Investor share class to Admiral share class upon reaching a higher balance. Do note that Vanguard allows you to convert from the mutual fund class to the ETF class but not the other way around.
Barefootgirl
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Re: Schwab Information Thread with FAQ, Links, Tips and Q&A

Post by Barefootgirl »

Just met with the local Schwab rep about a new account, etc. He was professional, knowledgeable, congenial.

We discussed opening a checking account along with the new brokerage account.

I haven't been happy with my current "hub" bank for awhile and am seeking a new one...for direct deposit, transfers, check cashing, etc.

For those who use Schwab for banking - any issues? any reasons they would NOT be a good hub bank? (my definition is as my primary banking relationship - although I have other banks for other reasons) Thanks
How many retired people does it take to screw in a lightbulb? Only one, but he takes all day.
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