How to transfer my account from Edward Jones
Brandon Renfro Many people who leave Edward Jones feel uncertain about the process, especially when it comes to avoiding unnecessary fees or taxes. The good news is that moving your accounts is a straightforward process once you understand the steps. This guide walks you step by step through how to move your accounts, what fees to expect, and how to avoid potential tax surprises along the way.
Step 1: Decide Where You’re Moving Your Accounts
Before you can transfer anything, you’ll need to know where the money is going. You have two main options:
- Do-it-yourself platforms like Fidelity or Vanguard.
- Work with a new financial advisor at a different firm.
Either of these are fine options depending on what you’re looking for. It depends on how much guidance and ongoing support you want. If you’re considering another advisor, make sure they are a good fit and provide the types of services you are looking for. Maybe you want an advisor that has a specific focus, or a local independent advisor that isn’t connected to a corporate office.
Step 2: Open Accounts at the New Firm
To transfer assets smoothly, you’ll need to open the right accounts before initiating the move. For example, if you have a Roth IRA and a brokerage account at Edward Jones, you’ll need the same types of accounts at your new firm. If you aren’t sure what types of accounts you have you can look at the top of each statement. If you’re working with an advisor, simply share your Edward Jones statements with them. They’ll confirm which accounts you need to open.
Step 3: Have the New Firm Initiate the Transfer
Once your new accounts are open you can ask your new advisor to initiate the transfer. You don’t have to ask Edward Jones to send the money. Think of this as “pulling” the money rather than “pushing” it. This is done through the Automated Customer Account Transfer Service (ACATS), which allows firms to electronically “pull” your investments over. Your new advisor submits the request, you approve it, and then Edward Jones fulfills it.
Step 4: Wait
In most cases, transfers can be done “in-kind,” meaning your actual investments move as they are. If you can’t transfer certain proprietary funds or products you’ll need to sell them first. Then, you can transfer the cash. Your new firm will notify you if something else needs to be done. If you don’t need to do anything else, the transfer is usually complete withinin a few weeks.
Are There Fees for Leaving Edward Jones?
Yes, if you decide to move your accounts from Edward Jones, there may be some costs involved. Edward Jones typically charges about $95 per account to transfer your investments to another firm, and in some cases there may also be fees tied to specific products, such as mutual funds or annuities, if they’re sold before the required holding period.
- Account Transfer Fees (ACAT fees): This applies to IRAs, taxable brokerage accounts, and certain retirement accounts. If you close multiple accounts, fees add up (e.g., 3 accounts = ~$285).
- Mutual Fund/Annuity Penalties: If you own proprietary Edward Jones funds or annuities, you may face contingent deferred sales charges (CDSCs) or surrender charges if sold before the end of their holding period.
Fortunately, in most cases these fees don’t add up to a whole lot. However, it’s good to know about them ahead of time so you can make an informed decision.
Will I Owe Taxes if I Transfer From Edward Jones?
Simply transferring accounts from one institution to another is not a withdrawal and does not create any tax liability or penalties. There are some points you need to consider though, and be careful about how you handle the transfer.
- If you do withdraw the money first (and deposit it in your bank account, for example) before you transfer it to another advisor you may be subject to taxes and penalties depending on the type of account you have at Edward Jones.
- If you need to sell a proprietary investment that won’t transfer to your new advisor, there isn’t anything to be concerned about if that investment is held within a retirement account. However, if you are holding it in a brokerage account then you need to be mindful of capital gains taxes that may apply depending on your cost basis and the current value of your investment.
Final Thoughts
If you’ve been with Edward Jones and are now thinking about moving on, you don’t need to worry about the process of transferring accounts. By choosing where you want your accounts to go, opening the right accounts, and letting the new firm handle the transfer, the process can be smooth and straightforward. Knowing about the fees and tax considerations in advance will help you avoid surprises. To get help from a local independent advisor and make sure that tax efficiency is a part of your retirement plan, email me at brandon@belongingwealth.com or call 903-471-0624 and I’d be glad to help you.