How do I properly pull my funds from one account and invest in another when I do not have a broker?
This is a follow-up to my previous question:
My investment account is increasingly and significantly underperforming vs. the S&P 500. What should I do?
Much of the advice I received pertained to switching my money to a Vanguard fund. This may seem obvious, but I am new to investing and I don't know how to pull my money out and re-invest it into a separate fund.
I'm assuming I will need a broker, and since I do not plan to micro-manage the new fund, would it be sufficient to pay one of the cheaper online brokerages instead of finding a personal account manager?
Also, what fees should I look out for if I pull my money from the current fund and re-invest in another?
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You need to contact the institution that is holding your current account, have them sell your fund investment, and then close your account and send you a check for the balance.
Then you can open an account directly with Vanguard (or call 800-319-4254).
You don't need an account with an online broker unless you want to be able to invest in funds outside the Vanguard family.
Fees will depend on the institution that you are currently using and the fund. With some funds you have to pay a "load" (percentage of your assets, in the neighborhood of a couple of percent) when you redeem shares. Your institution may charge you a fee for redeeming the fund (anywhere from [CO]/free to maybe or higher). Some institutions will charge a fee for closing the account. (I've seen anything from [CO]/free to , but I haven't looked around in a while.)
As MrChrister points out in a comment below, this is not the best method for an IRA. In that case, you'd want to make a transfer, and I'd recommend calling both your current institution and Vanguard (or wherever you end up transferring funds to) for forms and instructions on how best to do it.
Usually the new broker will take care of this for you. It can take a couple of weeks.
If you are planning to go with Vanguard, you probably want to actually get an account at Vanguard, as Vanguard funds usually aren't "No Transaction Fee" funds with many brokers. If you are planning to invest in ETFs, you'll get more flexibility with a broker.
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