Vanguard Fidelity

L1: Vanguard FidelityI’m having trouble with Fidelity setting up a 72T.Does anyone recommend someone else that they are using for their 72t IRA account? Vanguard, Scottrade anyone else?Thanks2010-07-15 21:18, By: retiredguy, IP: [71.79.8.77]
L2: Vanguard FidelityYou can do a search of this website. Almost all references to Vanguard have been favorable. Most posters here recommend them highly because they understand SEPP 72-T.Go to their website and search there for their information.2010-07-15 22:04, By: dlzallestaxes, IP: [72.78.110.86]

L3: Vanguard FidelityNo.As I have posted before, it was NO trouble setting up SEPP with Fidelity. I use their lowest grade “premium service” called Portfolio Advisory Services.Called my rep., he said type 72t in search window and read more, then sent me a form to fill out. They locked in rate when i requested, and started payouts when i requested. It has worked perfectly. If you only use their free service and do not have a CFP you speak with, expect no extra help.YOU MUST study this site and read the IRS info. Fidelity WILL NOT tell you when or how to do everything! If you are not 100%, then hire an expert.(andthe IRS examination regarding my SEPP is now closed! Once they got ALL my documents showing how Fidelity did the calculations they were satisfied.)2010-07-15 22:17, By: jb, IP: [173.216.91.206]

L4: Vanguard FidelityPosters that have used Schwab seem to be very satisfied over the last few years with their SEPPs. While far from a necessity, it isnonetheless a plus that Schwab is one of the few that provides the exception coding on the 1099R.2010-07-15 22:55, By: Alan S., IP: [24.116.165.60]

L2: Vanguard FidelityWhen I retired in late 2004, my 401k plan was with Fidelity. I thought that a Fidelity SEPP plan would be just the thing. I requested all of the info they had on had about this and the various account options that were available. They sent me a LOT of info. It was a stack of brochures and other info about 1″ thick. Knowing that this was a big part of my financial future, I waded through the info. I was amazed at the number and amount of fees that would be applied to my account. It seemed as if every possible action and even no action at all would generate a fee of some kind. This was not looking good to me, no matter how easy it would be to set up that SEPP plan.
At the same time, I also had a taxable investing account with Vanguard. I requested the same type of info from Vanguard, got a reasonable amount of it, and was amazed at the few fees that they charged and the small amount of those fees. Remember that this was in late 2004 and that things may have changed since then.
Anyway, I decided to go with a Vanguard SEPP and that worked out very well for me. Vanguard has done a good job with my accounts, only making one error that we worked on together to resolve to my complete satisfaction. I would recommend Vanguard as a SEPP / IRA custodian, even though they neither acknowledge that their clients have a SEPP nor offer the box 7 exception code of “2” on their 1099-Rs. I file a form 5329 to claim the exception to the 10% early withdrawal penalty.
Whichever company you have have as your SEPP / IRA custodian, it really pays to keep a close eye on the amounts that they distribute to you. You should know your official distribution amount to the penny. If ever there is a discrepancy, you need to contact them immediately and make sure that the proper amount gets distributed. This is why most of the folks on this web site recommend that people take their SEPP distributions in the 1st half of the month. If an error occurs, it can almost always be resolved before the month ends. This is critical if you take a distribution in December because the end of that month is also the end of that year and not just that month. Any mistakes not corrected prior to the next year are likely to bust a SEPP plan and become a VERY expensive mistake.
Ed

2010-07-15 23:44, By: Ed_B, IP: [71.236.183.224]

L3: Vanguard FidelityEd, it costs nothing to get a withdrawal plan set up.What costs is if you go to a brokerage account. If you look into it, about half of the fees are offset by the fact that being in the group means that the shares they buy for you are “admiral” class funds or load funds where the fees are waived and the ownership time limits are waived. (You also see dividend variances between individual and large corporation’s 401k/IRA plans.It was shocking to learn that there are so many classes of each fund and that some custodians take a percent or so off the top. My wife and i owned the same funds, she always got 1% less dividend)2010-07-15 23:57, By: jb, IP: [173.216.91.206]

L4: Vanguard Fidelity>Ed, it costs nothing to get a withdrawal plan set up.
No, it doesn’t. I don’t believe that I said that it did. If so, then that was not what I intended. My comment was directed towards the management fees charged by Fidelity vs. Vanguard. At that time, Vanguard’s fees were lower. Whether or not this is still true, I cannot say. But it IS worth checking into before signing up for a SEPP plan with any custodian.
I did look into it and made a decision based on what was printed in the documentation.
Yes, I do have Admiral class shares in 2 of my Vanguard funds. They do charge a fee for them but it is a bit less than their regular class fees. Vanguard’s fees have always been quite low. I have no problem paying them, as they are reasonable… unlike SOME other fund companies. Several other Vanguard funds in my portfolio are not Admiral class and their regular and reasonable management fees apply.
As a retiree, I do not have access to group rates anymore. I did when I was employed and had a 401k plan. Ah, the good old days. Well, maybe not so good. Being retired is better… a LOT better!
Ed

2010-07-16 01:47, By: Ed_B, IP: [71.236.183.224]

L5: Vanguard FidelitySorry to get crabby with you. When I tried to sign up with Vanguard they wouldn’t talk to me and only sent one thin folder of info. It seemed they didn’t want me…Probably just gota bad rep. That first impression can gain or lose customers as we both found out.2010-07-16 12:40, By: jb, IP: [173.216.91.206]

L6: Vanguard FidelityIuse Vanguard brokerage accountfor my IRA, but the only Vanguard fund used is their money market fund – the rest of the IRA is investedin a variety of EFTs from other companies. Yes, there is some expense associated with a brokerage account, but it also offers maximum flexibility in terms of investment choices without disturbing the basic IRA. I can move all or a portion of the assets to almost any other investment company without doing atransfer – partial or full.You are also better off doing the planning yourself, or at least checking/verfiying everything that is being done in the plan like interest rate, calculations, etc. Don’t think that just because someone does the calculations for you that the plan will fly – most problems with SEPP plans occur as the plan operates – mistakes made by the owner. You need to fully understand what you are working with.SEPP Planning Pointers2010-07-16 13:13, By: Gfw, IP: [24.148.10.164]