I have two IRA accounts from jobs b4 I went into business for myself.
A simple IRA with Franklin Templeton–3 mutual funds, small amounts.
A SEP IRA with Ameritrade–Money market, stocks, mutual funds. More money but still not much.
I’ve figured out how to navigate the Ameritrade accounts much better and would like to consolidate into the Ameritrade account.
Can I just sell out of the Franklin Temp investments and deposit that cash in the Ameritrade account in the same 6 mos. without any penalty? Two of the 3 mutual funds are dogs I’d like to not be in anyway.
Consult financial advisor? There’s less than 4grand in those 3 funds combined so I’m not inclined to worry much about it and would trust a rec. from you guys.
“Research is what I’m doing when I don’t know what I’m doing…”
Replies
Just contact your Ameritrade representative and tell them you want to roll the old IRA into your account. They should be able to take care of moving the funds directly from the old account into the new one - they fill out all the forms and all you have to do is sign them. I did the same thing to consolidate a couple IRAs last fall.
I started this process and there were some stupid complications... Couldn't find the fund numbers, didn't have authority... blah blah. It was a PIA, but I could try again.
I was thinking just to take matters into my own hands.
Thanks for reply"Research is what I'm doing when I don't know what I'm doing..."
I was told if you actual touch the money you have to pay the penaty but if it goes from one place to another,no. so if they send you a check you have to pay
Transfer the account containing the Franklin Funds to the Ameritrade account. This process is started thru your Ameritrade contact. They will need a copy of the statement of the current account holding the Franklin Funds.
There's no need to actually sell the funds.
But once at Ameritrae, be sure your overall portfolio is part of a productive strategy. Use the Franklin assets to mmove into a specific Franklin fund that the other holdings don't or can't provide. Such as their Utility fund or Gold fund. Not that I recommend either, but as an example to complete the overall portfolio.
Franklin has some good funds. Shame to sell them without fully taking advantage of the commission originally paid to get into them.
Edited 4/8/2008 5:33 pm ET by peteshlagor
"But once at Ameritrae, be sure your overall portfolio is part of a productive strategy. Use the Franklin assets to mmove into a specific Franklin fund that the other holdings don't or can't provide. Such as their Utility fund or Gold fund. Not that I recommend either, but as an example to complete the overall portfolio."
This is good advice. I did research better Franklin funds and whether I could buy them thru ameritrade. I'm in 3 of the Franklin funds and only one appears worth it. I'll see if I can turn the 2 dogs into a cat and then see if I can get IT to roll over.
Thank you."Research is what I'm doing when I don't know what I'm doing..."
Just completed a trasnfer of ALL my funds from AG Edwards to Raymond James after AG got bought by a bank (ie not good for investors). Had zero cost to me. Talk to your guy @ Ameritrade. If he can't figure it out find somebody better.
i've always thought of AG Edwards as one of the better outfits. Just because they got picked up doesn't necessarily mean trouble. Have you seen any thing specific to complain about or just anticipating problems?
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
I haven't seen problems that would affect clients - yet.
I have noticed that the money market options for cash sweeps have been discontinued for NEW accounts. They want the brokers to use the bank's deposit programs.
I certainly hope they keep some of the better market strategists and analysts.
But back to the IRA situation of the OP - the correct term to use for what's being proposed is a transfer. A rollover is when you receive a check before passing it on to the next custodian.
Although correctly done, it don't matter, the same effect is occuring.
The guy I've that's been my Master of Finances was the one that lead me to AG Edwards. It wasn't me selecting AG so when he left for Ray Jim I followed him.
Yes, AG Ed and Ray James are in the business to make money but they make it because their clients make money. I don't feel the same about banks. He left due to the anticipated poor performance that Wachovia will deliver. He's also confident that Ray James will get bought by a bank eventually but at that point he'll (he runs a firn wiht his sons that from their group) be in positon to start his own co. indie of the rest (I think they call it invesment boutique). When the announcement was made that Wachovia was buying them my guy was courted by something like 15 different investment groups unsolicited. That tells me something right there. Ray James was the only one that made the move for his clients to be no cost (on top of being a good co.). Almost a gain for me really. AG will charge me $75/account to close them (which should be completed on a final sweep soon) whereas Ray James willl return to me $75/account calling it a Fee Reimbursement which will be tax free. Pretty hard for me to draw anything off my IRAs tax free at 41yo so that's a plus.
Did I say unsolicited? Uh-oh....
James is a good house.
Thanks for the vote of confidence, Pete. I moved solely on Allen's recomendations. Also they dropped the int rate on the MMKT to at least 1% below what AG had it at almost immediately. I think it was close to what my Credit Union was paying out for savings. I hardly use the MMKT for anything other than a temp holding pond but that to me is an indicator (omen?) of things to come.
Bill is one of the sharpest around here for noticing the fine details. Accordingly, note this restriction:
2 Year Rule before rolling into an IRA.
During the 2-year period money in a SIMPLE IRA may be transferred to another SIMPLE IRA in a tax-free trustee-to-trustee transfer. If, during this 2-year period, money is transferred from a SIMPLE IRA directly into an IRA the penalty will be increased from 10 percent to 25 percent.
After the expiration of the 2-year period, a SIMPLE IRA may be transferred into an IRA.
"After the expiration of the 2-year period, a SIMPLE IRA may be transferred into an IRA."If it just says IRA then that is a "plain" IRA.But he has a SEP-IRA. Don't know if there is any kind of restricting rolling in to a SEP?The SEP and SIMPLE have nothing to do with "plain" IRA's and don't know why they had to confuse things using that term.If the SEP if not currently being added to I guess that he could set up a plain IRA and roll both of them into the new one..
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A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.
My experience with SEP's would suggest there is no substantial differences between them and plain IRA's, unless they are SAR-SEP's.
Actually, since EGTRRA, we can combine SEPs and IRAs, but the restrictions are quite different. It pays to know what those limitations are. I am picking up a check from a local contractor who has elected to contribute to his IRA rather than his SEP due to cash flow. I did not have a part of the decision, but it was a question. BTW, he is over 50 and eligible for a catch up contribution.(EGTRRA is the most recent retirement legislation, for those who thought my keyboard stuck!!)"The nearest thing to eternal life we will ever see on this earth is a governmental program" -Ronald Reagan
What you want to do is called a rollover. If you take the cash and then start a new account with it yourself ( possible and legal within a given time period) you take on the chance that missing a deadline or missing the right document creates taxes and penalties for yourself.
The easy and safe way to do this is to have Ameritrade handle the whole thing as a rollover for you. Once it is in that account, you can manage the funds as you do the rest of your Ameritrade account.
Welcome to the
Taunton University of Knowledge FHB Campus at Breaktime.
where ...
Excellence is its own reward!
By simple IRA do you mean a SIMPLE IRA or plain IRA?
Both the SIMPE and the SEP are retirment plans for small buisnesses. Not sure of the details of the SIMPLE.
A plain IRA is one that the tax payer sets up and had it is either deductable or non deducatable depending on the income level that year.
If it is a plain IRA is any of the non-decutable?
Is the SEP-IRA still being contributed to?
I am not sure if you can rollover other types of IRA's into a SEP-IRA.
Peter should know.
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A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.