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Vanguard recently announced that they are selling their individual 401(k), multiple-participant SEP, and SIMPLE IRA plan business to Ascensus (press release). They’ve already updated their small business retirement plan page. One-person SEP IRAs will stay at Vanguard.

Ascensus will provide custodial and trustee services, recordkeeping, client servicing, transaction processing, tax reporting, and other services, and plan participants will retain access to a diverse lineup of Vanguard mutual funds via the Ascensus platform.

This will affect a lot of small business owners who previously chose to open a Traditional Pre-Tax and/or Roth Solo 401k plan directly with Vanguard. The new stated fee schedule includes a $20 annual fee per Vanguard fund per account holder in the Individual(k) plan and a $20 annual fee per participant for custodial services. I believe the previous fee schedule was just the $20 annual fee per Vanguard fund per account holder, but it was waived if at least one participant had at least $50,000 in qualifying Vanguard assets.

I also find this move interesting in the context of the Vanguard company as a whole. This same week, Fidelity continued moving gradually towards being an “all-in-one” financial marketplace, recently adding a high-yield sweep option to their full-featured Cash Management Account. (I will note though, Fidelity does directly not offer a Roth Solo 401k option!) Fidelity is competing directly with the fintechs like Robinhood and SoFi that also want to be everything finance.

Meanwhile, Vanguard already shut down their own Cash Management option, VanguardAdvantage, in 2019. They made their Admiral Shares mutual funds more expensive than their ETF equivalents (they were initially the same expense ratio), which removed a major incentive to use a Vanguard brokerage account (as most other brokers won’t let you trade Vanguard Admiral mutual funds). There isn’t much reason to hold Vanguard ETFs inside a Vanguard brokerage account now that everyone has commission-free trades, and Vanguard seems perfectly fine with that. Now, they are no longer going to service their past Solo 401(k) clients, whether they wanted to stay with Vanguard or not.

Vanguard definitely seems to be narrowing their focus towards offering investment products like ETFs and mutual funds and simple investment advice. They appear happy to move away from anything that requires high-touch customer interaction like phone calls and paperwork. (I would note that my more recent customer service interactions with Vanguard have been more positive with lower hold times.) This is not necessarily a bad thing, especially if it leaves more resources for their other customers, but definitely a different direction than others.

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Vanguard Sells All Solo 401(k) Accounts to Ascensus from My Money Blog.

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A flexible alternative to a traditional bank account is getting better. The Fidelity Cash Management Account (CMA) is a brokerage account that also includes traditional bank features like ACH routing and account numbers, Billpay, mobile check deposit, physical checks, and ATM/debit cards.

Perhaps a lesser-known fact is that the standard “Fidelity Account” is a brokerage account that also offers ACH routing/account numbers, Billpay, mobile check deposit, checkwriting, and an ATM/debit card. One of the major additions to the CMA (and missing from the standard Fidelity Account) is that you get unlimited ATM fee rebates, worldwide:

Your account will automatically be reimbursed for all ATM fees charged by other institutions while using a Fidelity® Debit Card linked to your Fidelity Cash Management Account at any ATM displaying the Visa®, Plus®, or Star® logos. The reimbursement will be credited to the account the same day the ATM fee is debited from the account. Please note that there may be a foreign transaction fee of 1% that is not waived, which will be included in the amount charged to your account.

One of the major drawbacks to the CMA was that the only option for the core position was their “FDIC-insured Deposit Sweep”, currently paying 2.72% APY (as of 4/21/24). While better than the 0.01% many other brokers offer on cash sweeps, this yield is much lower than that of the money market fund options available in the standard Fidelity account. To get around this, many people used the auto-draft feature that lets you set the standard Fidelity brokerage account as the backup funding source, and then kept a minimal or zero balance inside the CMA.

Perhaps Fidelity noticed this activity as well, or perhaps they noticed certain 5% APY cash offerings from competitors, because in less than two months (June 15, 2024), the CMA is adding the Fidelity Government Money Market Fund (SPAXX) an a core position option. If you have a Fidelity Cash Management Account and look at the “Additional Information and Endnotes” section of your March 2024 statement, you should find the following notice. This has also been confirmed by an official Fidelity representative on the r/Fidelity Subreddit. From my statement:

Please note that on or around June 15, 2024, you’ll have the option to elect Fidelity(R) Government Money Market Fund (SPAXX) as your core sweep investment vehicle. You will not need to take any action if you wish to retain the Bank Sweep as your core position. For additional information on your core position options, including the current yields on the Bank Sweep and money market funds, please visit Fidelity.com/spend-save/fidelity-cash-management-account/overview and FundResearch.Fidelity.com/mutual-funds/summary/31617H102.

The 7-day yield of SPAXX is 4.95% as of 4/19/24, significantly higher than the 2.72% FDIC-insured sweep. Money market mutual funds are unable to offer FDIC insurance, but they are still heavily-regulated by the SEC to hold very conservative and liquid investments. “Government” money markets have even stricter requirements, and that is why they are used as cash sweep funds. I personally lose zero sleep over holding cash in a money market fund run by a reputable firm like Fidelity, Vanguard, or Schwab.

This is a positive development for those that use the Fidelity CMA, especially if your state doesn’t have income taxes on investment interest that create an incentive to hold money market funds with mostly interest from Treasury bonds. If you do live in such a state, you should know that in 2023 neither Fidelity Government Money Market Fund (SPAXX) nor Fidelity® Treasury Money Market Fund (FZFXX) met the minimum investment in U.S. government securities required to exempt the distribution from tax in California, Connecticut, and New York. (Despite having Treasury in the name, FZFXX only had about 20% in eligible Treasury interest.) These are the core positions available in the standard Fidelity Account.

As such, residents of California, Connecticut, and New York may want to hold the Fidelity Treasury Only Money Market Fund (FDLXX), as it did meet those requirements in 2023 with roughly 90% of interest eligible for exemption. This is not a core option so you do have to buy this mutual fund manually, although the CMA account will sell it automatically to meet any cash demands that come up later. But still, if you forget for a few days, the interest difference is much smaller between SPAXX and FDLXX.

I am definitely switching over my core position as soon as I can. June 15th, 2024 is a Saturday, so I’ll check on Friday the 14th and then Monday the 17th. You can switch over manually by logging into Fidelity.com, going to “Accounts & Trade”,” Account Positions”, and then “Cash”. You should then see the button to “Change Core Position”.

“The editorial content here is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone. This email may contain links through which we are compensated when you click on or are approved for offers.”

Fidelity Cash Management Account To Add New Core Money Market Fund Option (SPAXX @ ~5% APY) from My Money Blog.

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SoFi Invest is offering an increased ACAT transfer bonus up to $10,000 for transferring in new assets. Some of the tiers are double what they used to be, but the minimum holding period was also increased. Valid for both taxable brokerage accounts and IRAs (Traditional, Roth, or SEP).

$25 Referral bonus. As this promo includes existing accounts, you should consider grabbing this new account referral bonus first, worth $25 of stock with an initial deposit of only $10.

Get $25 worth of your favorite stock to start building your portfolio when you fund your SoFi Active Invest account** with at least $10*.

New SoFi Invest accounts (both new and existing accounts are eligible)

• $100 bonus with $5,000 to $19,999 in new assets
• $200 bonus with $20,000 to $99,999 in new assets
• $500 bonus with $100,000 to $249,999 in new assets
• $750 bonus with $250,000 to $499,999 in new assets
• $1,000 bonus with $500,000 to $999,999 in new assets
• $2,500 bonus with $1,000,000+ to $1,999,999 in new assets
• $10,000 bonus with $5,000,000+ in new assets

Assets are now required to remain in your SoFi account for 2 years. This used to be only for 180 days.

Earn a bonus (as described in the chart below) when you transfer investments from another brokerage firm into a taxable SoFi Invest Active brokerage or Active retirement account (Traditional, Roth, or SEP IRA). Bonus amounts are based on the total net dollar amount (incoming transfers less outgoing transfers) of settled transfers from another brokerage to an individual SoFi Invest account during each calendar month. Bonuses will be paid within 14 days of the last day of the month in which the transferred assets settled in your SoFi Invest account. Bonuses will be paid into the same account you transferred investments into. Transfers into multiple accounts may not be combined. Assets are required to remain in your SoFi account for 2 years. SoFi reserves the right to recoup up to the bonus amount from any withdrawals that take place prior to the 2 year period. SoFi also reserves the right to change or terminate this promotion at any time without notice. Important Tax Information: The value of the reward you receive may constitute taxable income. SoFi Securities LLC may issue a Form 1099 (or other appropriate form) to you that reflects the value of the reward. Please consult your tax advisor. SoFi Securities LLC and its affiliates and associates do not provide tax advice.

Note that SoFi Invest does NOT accept mutual funds.

We do not accept mutual funds. These funds would need to be liquidated prior to initiating an ACAT with SoFi. Please contact your brokerage firm to complete this action, prior to submitting an ACAT.

In addition, SoFi will cover the outgoing transfer fee charged by your existing broker:

If you transfer a brokerage account with total asset value over $5,000 through the ACAT system, SoFi will reimburse up to $75 of ACAT Fees from your outgoing brokerage firm.

General Transfer Tips

• Before moving, I would download all your old statements and tax cost basis information to make sure it transfers over correctly.
• An ACAT transfer can take a week or so to complete, so you won’t be able to make any sell transactions during that time.
• Consider performing a “partial” ACAT transfer where you only move over specifically designated shares (ex. only all 100 shares of BRKB) if you wish to keep some of your original brokerage account open. I would personally transfer over all shares of any specific ticker, so that the tax cost basis carries over neatly.
• Compare bonuses across different brokers. Look carefully at the tiers, there may be a sweet spot where the percentages are better.

“The editorial content here is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone. This email may contain links through which we are compensated when you click on or are approved for offers.”

SoFi Invest ACAT Transfer Bonus Promotion: $100 to $10,000, Both New and Existing Accounts from My Money Blog.

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E-Trade is offering an increased transfer offer for existing E-Trade customers of up to $6,000 for transferring in new assets. This specific offer only applies to non-retirement accounts. You must enroll in the offer first after logging into your E-Trade account, fund within 60 days, and keep there for at least 6 months. These tiers are currently better than their offer for new customers.

Existing E-Trade customers (non-retirement taxable accounts only)

• $125 bonus with $5,000 to $24,999 in new assets
• $250 bonus with $25,000 to $99,999 in new assets
• $625 bonus with $100,000 to $199,999 in new assets
• $1,000 bonus with $200,000 to $499,999 in new assets
• $2,000 bonus with $500,000 to $999,999 in new assets
• $4,500 bonus with $1,000,000 to $1,999,999 in new assets
• $6,000 bonus with $2,000,000+ in new assets

These are relatively good percentages for a more established broker. (Morgan Stanley bought E*Trade in 2020, and is in the Top 10 for assets under management.) Importantly, I don’t see any minimum hold period on the offer page beyond keeping the assets there through the end of the 60-day qualification period after enrollment. (Update: The minimum hold period is 6 months, something but not too bad.)

Overall Brokerage Transfer Tips

• Many brokers will charge an “Outgoing ACAT fee” of $50 to $100 when you leave them. (Notably, Fidelity and Vanguard do not. Schwab allows free partial transfers.) I recommend contacting your destination broker and asking them to reimburse you for this fee, on top of any bonuses. If you qualify for one of these bonuses, your account is probably big enough for them to consider it. The worst they can say is no. You may have to send them a statement showing the fee.
• Before moving, I would download all your old statements and tax cost basis information to make sure it transfers over correctly.
• An ACAT transfer can take a week or so to complete, so you won’t be able to make any sell transactions during that time. As long as you do an in-kind transfer, you’ll just keep the same shares of the same securities as before.
• Consider performing a “partial” ACAT transfer where you only move over specifically designated shares (ex. only all 455 shares of BRKB) if you wish to keep some of your original brokerage account open. I would personally transfer over all shares of any specific ticker, so that the tax cost basis carries over neatly.
• Compare bonuses across different brokers. Look carefully at the tiers, there may be a sweet spot where the percentages are better.

“The editorial content here is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone. This email may contain links through which we are compensated when you click on or are approved for offers.”

E-Trade ACAT Transfer Bonus Promotion: $125 to $6,000 for Existing Customers from My Money Blog.

Copyright © 2004-2022 MyMoneyBlog.com. All Rights Reserved. Do not re-syndicate without permission.

New quarter, new offers. A quick 2024 Q2 reminder that you can discover targeted offers for your Chase-issued credit card at Chase.com/mybonus. This includes both their in-house cards like Sapphire or Freedom Flex and their co-branded cards like United, IHG, Hyatt, Southwest, Amazon, etc. For some reason, these are often offers that they don’t tell you about otherwise by email or snail mail.

Selected folks are getting 5X points on Gas Stations, Groceries, and Home Improvement Stores:

Many others are being offered a $25/$35 discount on annual subscriptions of MAX (formerly HBO Max) streaming service.

You may also simply get a message that your card can’t be found or that you weren’t targeted:

In some cases, you may be able to stack on top of your existing rewards, for example the current 5% cash back categories of the Chase Freedom and Freedom Flex.

“The editorial content here is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone. This email may contain links through which we are compensated when you click on or are approved for offers.”

Chase MyBonus 2024 Q2: Check For Targeted 5X Points or HBO Max Offers from My Money Blog.

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Capital One has brought back a deposit promotion worth up to $1,500 for new 360 Savings accountholders. It’s a good bonus, but only for “new” customers and those that are willing to keep an eye on things. Here’s their definition of “new”:

If you have or had an open 360 Performance Savings, 360 Savings, 360 Money Market, Savings Now or Confidence Savings account as a primary or secondary account holder with Capital One on or after January 1, 2022, you will be ineligible for the bonus. If your account is in default, closed or suspended, or otherwise not in good standing, you will not receive the bonus.

Note: Some readers have reported in the past that they were not able to apply the promo code even as valid new customers, and Capital One responded that this was a targeted promotion even though there is no such language on the offer page nor in the terms and conditions. After applying, I would contact them and make sure that the promo code “BONUS1500” was accepted before making a large deposit for this promo.

The steps:

• Open a new 360 Performance Savings account with promo code BONUS1500 on or after April 3, 2024.
• Deposit $20,000+ of external funds during the 15-day Initial Funding Period after opening your account.
• Hold the deposit(s) in your account for an additional 90 days after the 15-day Initial Funding Period ends.
• $20,000+ deposited = $300 bonus.
• $50,000+ deposited = $750 bonus.
• $100,000+ deposited = $1,500 bonus.
• See the bonus in your new account within 60 days after holding.
• You’ll also earn their normal interest rate (variable, but currently 4.25% APY as of 4/17/24). No monthly fees or minimum balance requirements.

Note that the 90-day “maintain balance” period is after and in addition to the end of the 15-day “initial funding period”. So if you are counting from the opening day, that is a total of 105 days after opening. This is important as other readers have gotten denied for the bonus when withdrawing after 91-100 days. You may wish to chat with Capital One to confirm the exact date.

As long as you hit the tiers exactly, you are getting 1.5% of your deposit with technically a minimum holding period of 90 days, but you’ll probably want to send it in a little early and take it out a little late to be safely within the deadlines. Let’s call it 120 days for a conservative round number. This works out to the equivalent of (a little more than) a 4.5% annualized yield. If you assume the current 4.25% APY holds, that would be an estimated 4.5% + 4.25% = 8.75% annualized yield for those 120 days.

A 4-month CD at nearly 9% APY is not bad if you have a lot of money and a short-term horizon for it. Again, this one is only for new customers or those that have closed their previous CapOne360 savings-type accounts by January 1, 2022.

“The editorial content here is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author's alone. This email may contain links through which we are compensated when you click on or are approved for offers.”

Capital One 360 Savings Deposit Promo ($300 to $1,500 Bonus) from My Money Blog.

Copyright © 2004-2022 MyMoneyBlog.com. All Rights Reserved. Do not re-syndicate without permission.