How do I move my Roth IRA at WM Financial Services to another one (eg. Vanguard, Fidelity or Scotttrade)?

I have a Roth IRA with WM (Washington Mutual) Financial Services since college. Since my intial deposit in June 2004, I'm not too happy with the performance, the Morningstar rating on my funds have dropped and I've been enticed by other companies such as Vanguard or Fidelity. Can I make this switch and will there be fees incurred? If I can move the existing balance to a new company, do I have to start over the "5-year" hold period required to withdraw with no 10% penalties or taxes for first-time home-buyers even though I've accumulated 3 years since my first deposit??

The easiest way to do this is to call Vanguard and tell them your situation. They'll be very happy to help you move the fund over and will hold your hand to do so.

The fees depend on the WM fund you have. Check the prospectus for the fund and see what they say about minimum hold period without a penalty. If you're going to incur one, I'd probably just stick it out at WM, but leave when the time is up and just call it a lesson learned.

Vanguard and/or Fidelity are the way to go, IMO. Always check the "Operating Expense Ratio" for a fund and never pay more than 0.20% (check out what you're paying at WM, if you can stand the pain). That's the money that the fund managers take out of your profit and put in their own pockets.

Good luck,

Doug

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