DD has a Roth IRA account that I set up for her 3 years back. I have been managing her Vanguard account and sending money in periodically using their deposit slips. She is a college student and works in the summer, but earnings fluctuate from summer to summer.
The investment slip option has been cancelled. My question is: is it ok to link my checking account to her Vanguard mutual funds account for future online deposits that I will make on her behalf?
Thanks.
You need to talk to the folks at Vanguard.
I just went through transition of funds from Scottrade to TD Ameritrade and there were all sorts of rule changes.
It’s possible that your daughter is going to have to take on more ownership of the account at this point, because it may or may not be possible to direct link to an account that she does not own.
Calmom is correct. My son has his Roth IRA at Vanguard and I can’t transfer funds directly from my bank account to his IRA because he can’t link to an account he doesn’t own. I’ve gotten around that by transferring funds from my bank account to his (we both have USAA checking accounts) and then he can make the Roth IRA purchase by transferring the funds from his linked checking account.
During college, my kids and I set up joint accounts for each of them and me. It allows me to easily transfer funds to them for housing/food expenses and help educate while they have their financial training wheels on. It was also helpful during study abroad periods to have that access. One had a problem with a card while in another country and being authorized on their account gave me the ability to deal with it on their behalf in a quick manner, for example.
I do the same as you on the Roth IRA thing so that has made the process easy, too.
Your daughter can authorize you to have access to make transactions on her Vanguard account. You can then use the Vanguard app to deposit a check from you to her account.
Does your daughter have a checking account? If not, open one. Then set up her online Vanguard account for electronic withdrawals from her checking account (you will need the routing and account numbers found at the bottom of the checks). You only have to set it up once, and it’s easy. You can deposit money into her checking account then log into the online Vanguard account and buy her IRA. They will withdraw the funds electronically. Fast and easy.
I you need help setting it up, call Vanguard and they will walk you through the steps. They have great customer service.
Edit: Here is a link to a contribution form you could mail in…
https://personal.vanguard.com/pdf/s052.pdf
Yes, the folks at Vanguard will walk you through the steps. We did this a few months ago. In our D’s case, she has a checking account so it was fastest for us, since she was here for the holidays, to write out a check. Then she took a picture and auto-deposited it. The next morning funds were available for her to transfer to her account.
Our D is well past college so we didn’t want to tie accounts together.
Thanks for all your suggestions. DD has a checking account which I can transfer funds to her, then she can do the online purchase herself, it is a process that I want to talk to her about once she is home for the summer. I know she won’t feel comfortable doing it herself, I can still tell her when to do it and how much to purchase, after she gets the hang of it, maybe next year she can go through the process on her own.
I did for my son through his college years, once he started his full time job, I MADE him contact the company and then set up a monthly automatic withdrawal for his Roth IRA account. But do you think he ever takes a look at the account?
Like when I explained to them what Roth IRA is, how the savings would help them in the future, they smiled and nodded and couldn’t wait to take off!!! I guess investing is not their hobby, any tips on how to change that??
@Hopeful820 my D also had zero interest in the Roth IRA we set up for her - until one of her accounting major friends told her what a good thing that was!