How to Roll a Vanguard IRA Into a Fidelity IRA


Both Fidelity and Vanguard offer Individual Retirement Accounts, or IRAs. An IRA is a tax-advantaged investment account that defers taxation on account earnings until you take a withdrawal. If you intend to move your IRA account from Vanguard to Fidelity, you must follow certain rules to avoid taking a distribution rather than effecting a transfer. A distribution will be fully taxable at ordinary income tax rates, and if you are under the age of 59 1/2, you will owe an additional 10 percent on the amount withdrawn.

Open a Fidelity IRA. In order to transfer your Vanguard IRA assets, you need to have an account open to receive them. When you open an account at Fidelity, you must provide information such as your name, date of birth, address, Social Security number, beneficiary and years of investment experience. You can open a Fidelity IRA either online or at a local branch.

Ask for a transfer form. Inform your Fidelity representative that you wish to transfer over IRA assets from Vanguard. You will receive a transfer form which asks for identifying information on the delivering firm, such as your account number. You can find the pertinent information on your most recent statement from Vanguard, which you should also attach to your Fidelity transfer paperwork.

Liquidate assets that cannot be transferred. While you should be able to transfer most of the assets in your Vanguard IRA to your Fidelity IRA, certain specialty proprietary investments, such as limited partnerships, may have to be sold rather than transferred. After the sale, you can transfer the cash to your Fidelity IRA.

Verify the transfer. While transfers between firms are generally swift and error-free, check to see that your Fidelity IRA receives all of your Vanguard assets. Dividends or other payments may hit your Vanguard IRA after you initiate the transfer process, so confirm that all of your money ultimately arrives in your Fidelity account.

Request a check from Vanguard. Although most transfers are done electronically between firms, you do have the option of getting a physical check from Vanguard for the balance of your IRA and redepositing the funds manually into your Fidelity IRA. If you choose to transfer your funds in this manner, you must redeposit the IRA funds within 60 days, or the IRS will consider your transfer a withdrawal, subject to taxation and possible early withdrawal penalties.

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