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Author: edrohr One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121599  
Subject: Pitfalls Rolling Indiv. Ret. Acct to Datek IRA Date: 11/3/1998 9:40 PM
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Background: Rolled my AMEX pre-tax w/employer contrib. to Fidleity Inv. Mutual Fund Ind. Retirement Acct. in 1994. Graduated Motley Fool Workbook and Motley Fool Investment Casette tape 11/98. Now: I would like to "roll" this account to a Datek "Self Directed IRA" and participate in the "Dow Foolish Four". Q1: Any tricks to the "roll"? Q2: How to reinvest dividends without tax consequences before normal withdraw? Q3: How much time do I have after the "roll" from the mutual to a cash account to reinvest? Any and all help would be appreciated. Foolishly yours, Just Ed (not to be confused with the horse Mr. Ed.) RSVP
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Author: TMFTaxes Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 6123 of 121599
Subject: Re: Pitfalls Rolling Indiv. Ret. Acct to Datek I Date: 11/4/1998 11:15 AM
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[[Background: Rolled my AMEX pre-tax w/employer contrib. to Fidleity Inv. Mutual Fund Ind.
Retirement Acct. in 1994. Graduated Motley Fool Workbook and Motley Fool Investment
Casette tape 11/98.]]

OK...I think I understand. In effect, you rolled over some sort of employer retirement plan into an IRA account in some way, shape or form...right?

[[ Now: I would like to "roll" this account to a Datek "Self Directed IRA" and
participate in the "Dow Foolish Four".]]

OK...again, it seems that you simply want to move your IRA from one broker to another.

[[ Q1: Any tricks to the "roll"?]]

Not really. Just tell Datek what you are trying to do. They'll help you with the paperwork. The Fidelity people will liquidate your mutual funds, and transfer the cash to Datek. It may take a while, but there are no tricks. Just make sure to use a "trustee to trustee" transfer directly from Fideltiy to Datek. Don't take a check from Fidelity and move it yourself to Datek.

[[ Q2: How to reinvest dividends
without tax consequences before normal withdraw?]]

Sorry, but I'm not following this question. Within an IRA account, the dividends will be tax deferred. You can either keep them in a cash account (until you make your next F4 move), or place them in some other investment until you need the funds. The Datek broker should be able to help you with your decision.

[[ Q3: How much time do I have after the "roll"
from the mutual to a cash account to reinvest?]]

Again, if you do a "trustee to trustee" transfer, there are no time limitations. If you take the check yourself, you have only 60 days to make the rollover (from the date of the receipt of the check from Fidelity). And, not only that, you'll then be restricted from changing brokers for at least one year. That is why I prefer a trustee to trustee transfer in your situation.

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