A question about moving stocks from one account to another


You frequently state that, based on the last decade, a U.S. market index Exchange-Traded Fund (ETF) which tracks the S&P 500, held in a tax-advantaged account, has been the investor’s best way for growing savings and is likely to remain so for many years. I have some dividend-paying stocks that I inherited from my mother.  They are in a tax-advantaged account which has accumulated some cash as a result. What is the best way to convert these and the cash into an exchange-traded fund which tracks the S&P 500?

Monday Morning Millionaire Program Answer:

You are correct in noting the benefits of investing in a U.S. market index Exchange-Traded Fund (ETF) which tracks the S&P 500.  It is as easy to match (minus a small transaction cost) as it is difficult to beat. There are several other ways of getting a decent income from the stock market and a portfolio of dividend-paying stocks can be excellent.

The tax implications of changing your holdings within the present tax-advantaged account or moving into an exchange-traded fund that tracks the S&P 500 might cost you more than the benefits of so doing. Consult with a fee-only financial advisor and not a fee-based advisor. A fee-only advisor has no conflict of interest. A fee-based adviser charges commissions as well as fees. The temptation to put savers into investments that generate higher incomes for the advisor is frequently difficult to resist.



Dr. Milan Somborac

The Monday Morning Millionaire Program supports do-it-yourself (DIY) investors which I have been for over 50 years. About my team and me

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