Thinking about making a move from Vanguard to Fidelity? You're not alone! Many investors choose to switch their brokerage or retirement accounts for various reasons, from a different user experience to a wider range of investment options. The good news is that transferring your account is a straightforward process, primarily handled through a system called ACATS (Automated Customer Account Transfer Service).
Let's walk through the process together, step-by-step, to make this transition as smooth as possible.
Step 1: Get Ready to Make the Move!
Before you initiate the transfer, it's crucial to prepare. Think of this as getting your ducks in a row. It's time to check your account details and understand what you're moving.
Do you have the right account at Fidelity? The account you open at Fidelity must match the account you're transferring from Vanguard. For example, if you're moving a Vanguard Roth IRA, you need to open a Roth IRA at Fidelity. The same goes for taxable brokerage accounts, traditional IRAs, and other account types. Make sure the account registration and ownership details (e.g., name, address) are an exact match at both firms. Any mismatch can cause significant delays.
Gather your Vanguard account information. You'll need your Vanguard account number(s) and a recent statement. A statement is essential as it provides a clear record of your holdings and is often required for the transfer request.
Decide on a "full" or "partial" transfer.
Full Transfer: You'll move your entire account, including all holdings and cash. This often leads to the closure of your Vanguard account.
Partial Transfer: You'll only move specific assets or a portion of your cash. Your Vanguard account will remain open.
Check for ineligible assets. Not all investments can be transferred "in-kind" (meaning, as they are). Some assets, like certain mutual funds that aren't available at Fidelity, will have to be liquidated (sold) before the transfer, and the cash will be moved over. This could have tax implications, especially in a taxable brokerage account.
A key point to consider: Vanguard's proprietary mutual funds, like VTSAX, can often be transferred as is. However, if you want to continue investing in them at Fidelity, you might need to convert them to their ETF equivalent (e.g., VTSAX to VTI) before you initiate the transfer. This can be done by calling Vanguard's customer service and can help you avoid potential trading fees at Fidelity later on.
Step 2: Initiate the Transfer at Fidelity
This is the most important step, and it's surprisingly simple. The receiving firm (Fidelity) handles the heavy lifting through the ACATS system.
Log in to your Fidelity account and navigate to the "Transfers" or "Accounts & Trade" section. You'll typically find an option to "Transfer an account to Fidelity" or "Move an account to Fidelity."
Follow the online prompts. You will be guided through a secure, step-by-step wizard. You'll be asked to provide your Vanguard account information, including the account number and type.
Upload your account statement. You'll likely be asked to upload a recent Vanguard account statement as part of the online application. This helps Fidelity verify your holdings and ownership.
Choose your transfer type. Indicate whether you're performing a full or partial transfer. If partial, you'll need to specify which assets you want to move.
Review and submit. Double-check all the information you've entered. Once you're confident everything is correct, you can electronically sign and submit the request.
Step 3: The Waiting Game and Monitoring
Once you've submitted the request, the ACATS process begins. Now is the time for a bit of patience.
Fidelity and Vanguard communicate. Fidelity will send the transfer request to Vanguard. Vanguard will then review the request, verify the information, and prepare the assets for transfer.
Track the transfer status. Fidelity provides a great online "Status Tracker" where you can monitor the progress of your transfer. This will give you an estimated completion date and show you which assets have been moved.
Be aware of transfer fees. Vanguard may charge a fee for a full account closure and transfer. While this is a possibility, it's worth noting that Fidelity often offers to reimburse these transfer fees for accounts over a certain value (e.g., $25,000). Be sure to ask Fidelity about their transfer reimbursement policy and how to submit a request for it.
Avoid trading during the transfer period. Once the transfer is initiated, your assets may be "ringfenced" at Vanguard, meaning they are temporarily unavailable for trading. To avoid any issues or delays, it's best to avoid making any new trades or deposits in the account you are transferring.
What happens to your investments during the transfer? If you're transferring assets in-kind, they remain invested and continue to be subject to market fluctuations. If assets are liquidated, the cash will be transferred, and there will be a period where the funds are not invested, potentially leading to missed market gains.
Step 4: The Transfer is Complete!
Congratulations! Your investments are now at Fidelity.
Check your Fidelity account. Once the transfer is complete, your transferred assets will appear in your Fidelity account. Verify that all your holdings are there and that the cost basis information has been transferred correctly. This is crucial for calculating future capital gains or losses.
Re-evaluate your portfolio. Now is a great time to review your portfolio at Fidelity. You have a new platform with a wide range of investment options, including Fidelity's own mutual funds and ETFs. You might want to consider reinvesting any transferred cash or adjusting your holdings based on Fidelity's offerings and your investment goals.
Close your Vanguard account (if you did a full transfer). If you performed a full transfer, your Vanguard account might be automatically closed. However, it's a good idea to confirm with Vanguard's customer service that the account is indeed closed and that you have no remaining balances or lingering holdings.
Frequently Asked Questions (FAQs)
Here are quick answers to some common questions about transferring your account.
How to transfer an IRA from Vanguard to Fidelity? You will initiate the transfer through Fidelity's website. The process is the same as transferring a brokerage account, but you must open a matching IRA (e.g., Roth IRA to Roth IRA) at Fidelity first.
How to transfer Vanguard mutual funds to Fidelity? You can transfer Vanguard mutual funds in-kind if Fidelity offers them. For those they don't, you may need to sell them and transfer the cash. Consider converting them to their ETF equivalent at Vanguard before the transfer to hold them at Fidelity without transaction fees.
How to avoid fees when transferring from Vanguard to Fidelity? While Vanguard may charge a fee for a full account transfer, Fidelity often reimburses this fee for larger transfers. Be sure to ask Fidelity's customer service about their reimbursement program.
How to track the status of my transfer? You can track the progress of your ACATS transfer through the online Status Tracker on Fidelity's website.
How long does it take to transfer from Vanguard to Fidelity? An ACATS transfer typically takes 3 to 6 business days for brokerage accounts. However, retirement accounts and transfers involving complex assets may take longer, sometimes up to several weeks.
How to transfer fractional shares? In a full ACATS transfer, fractional shares will be automatically liquidated by Vanguard, and the cash proceeds will be transferred to your Fidelity account. You won't be able to transfer the fractional shares themselves in-kind.
How to transfer a 401(k) from Vanguard to Fidelity? This is a rollover, not a standard ACATS transfer. You'll typically initiate a rollover through Fidelity's website. They will provide the necessary paperwork and guide you through contacting your old 401(k) provider (Vanguard) to move the funds.
How to transfer my cost basis to Fidelity? As part of the ACATS transfer, Vanguard is required to send your cost basis information to Fidelity. It's crucial to verify that this information is correct once the transfer is complete.
How to handle a transfer rejection? If your transfer is rejected, it's almost always due to a mismatch in account details or ineligible assets. Check the rejection notice for the reason and contact either Fidelity or Vanguard to resolve the issue.
How to transfer from a joint account? The Fidelity account you open must have the exact same ownership registration as the Vanguard account. For a joint account, both owners need to be listed on the new Fidelity account.