401K Rollover - Brokerage and Fund Question

[parafly]

My wife and I will both be rolling over our 401K's into traditional IRA's in the near future. They are a combined $25K.

We have both maxed out our Roth IRA's for the past two years and will continue to do so for as long as possible. The accounts are with Vanguard and the fund is Target Retirement 2045. We are very satisfied with the fund, service, and expense ratios at Vanguard.

Would it be wise to use Vanguard and the same funds for our 401K rollovers? I understand that diversification will not be an issue because of the fund type, but I am wondering about putting all of our eggs into the Vanguard basket. Would it be better to go with another brokerage such as Fidelity and use their target retirement funds instead?

We would love to stay with Vanguard, but we want to protect our assets as much as possible. Is "brokerage diversification" a good idea or am I worrying about something that is not really significant?

[Broken Arrow]

Yes, it is perfectly fine-- perhaps even recommended-- to hold the same type of target retirement funds, even when they are in different accounts.

In fact, doing so causes less potential unforeseen risks that is introduced when different funds mix and alter the intended asset allocation.

The only time you really want to pick different funds is when you have something very specific in mind beyond the core fund.

[disneysteve]

I agree with BA that it is fine to use the same fund if it makes sense for the intended purpose of the money.

As for the fund family, I see no reason to split up your money. Keeping it all with Vanguard is just fine and will make record-keeping much easier.

[parafly]

Thanks for the responses! I'll stick with Vanguard.

[sofocused978]

I just rolled my old 401k over to a Vanguard Target IRA a couple months ago. Their customer service is top notch and they made the transition quick and eazy. :thumbsup