Cash Management
The Withdrawal Process for Your Investment Portfolio
1. Your Withdrawal Request:
Please call or email us with your requested withdrawal amount. If you email your request, we are required for security and compliance reasons to call you to confirm the email is from you before processing your cash request. If you email us and do not receive a call within 2 business days to confirm your request, please assume we did not receive your email and call us at 713-850-8900.
2. Our Confirmation E-mail:
After we have confirmed your request by phone, we will send you a confirmation email with the details of your withdrawal request typically within 1 to 2 business days. Assuming we have received your reply to our confirmation email, we will then continue with the withdrawal process including selling any investments needed to create the cash for the withdrawal. To avoid delays in processing your request, we recommend you respond within two business days to our confirmation email.
3. Selling Investments to Create the Required Cash:
If the amount of your withdrawal exceeds the available cash balance in your portfolio, we will submit sell trades to create the cash. This process typically takes between 3 to 5 business days to complete. Additional time may be needed if there are extensive tax considerations including:
- In non-IRA accounts, potential capital gains taxes on stock sales to create the required cash;
- For non-IRA accounts, loss carryforwards and tax loss harvesting opportunities; and/or
- For IRA accounts, income taxes based on the withdrawal amount.
4. Making a Withdrawal Online:
For non-IRA accounts and for some IRA withdrawals, we may recommend that you log in to the broker’s website to make your withdrawal. If you are not familiar with the online withdrawal process with your broker, please call us at 713-850-8900 for an initial walk-through on how to make withdrawals online. We will also show you how to link your bank account to your brokerage account for future withdrawals.
If you own a non-spousal inherited IRA (also known as a Beneficiary IRA), your broker will not calculate any required minimum distribution amounts (RMD). The tax code pertaining to this type of IRA withdrawal is more complex compared to an RMD for a traditional IRA, which brokers typically calculate. As a result, we recommend our clients either contact their CPAs or have us work with their CPAs on their behalf to calculate any required distributions from non-spousal inherited IRAs. If you would like us to work with your CPA or you need a CPA referral to calculate the RMD, please let us know.
Please allow at least 10 business days to complete any transfer of funds to an account you do not own (e.g., sending a donation to a charity, funding an escrow account for real estate purchase, sending funds to another family member). This time frame includes the time required to sell any investments to create the cash for the withdrawal and submitting any forms and letters of instruction to your broker to send funds to a third party.
While we can sell investments to create the cash for the withdrawal, we cannot facilitate the withdrawal to a third party such as preparing brokerage forms and letters of instruction. The reason is that your broker’s insurance policy may not cover any loss of funds (e.g., the title insurance company provides incorrect wire instructions to an escrow account) if we play a key role in this type of transaction. As a result, we typically recommend that our clients make this withdrawal on the broker’s website if the cash must come directly from the account. Another option may be to first send the funds to an external account you own such as your checking account, which is a process we can help you with, and then write a check from this account to the third party.
Please allow for at least 5 to 7 business days to complete a non-IRA withdrawal, assuming your banking information is already on file with the broker. At least 3 additional business days may be needed to complete the withdrawal if new banking instructions (e.g., a new checking account) need to be submitted to the broker.
After we have confirmed with you that the cash is available for withdrawal in a non-IRA account, the following withdrawal options are typically available:
- You can initiate the withdrawal either by calling your broker or submitting your request after logging in to the broker’s website (recommended for non-IRA accounts).
- Either you or The Goff Financial Group can instruct your broker to do one of the following:
- Send the funds to another account you own at the brokerage firm;
- Send the funds to an external account (e.g., your checking account) assuming the broker has your bank information on file; or
- Instruct the broker to mail a check to the address of record for your account (not recommended for security reasons).
- You can initiate your withdrawal request from an external account such as your checking account that is set up to receive the funds from your brokerage account.
Please allow for at least 10 business days to process withdrawals from an IRA. This time frame includes the time required to prepare your broker’s IRA distribution form (if required) for your review and approval, set up any new deposit instructions, and process any sell trades needed to create the cash for the withdrawal. If your IRA is subject to required minimum distributions (RMDs), we recommend starting the RMD process by no later than October 1st each year. When making a withdrawal from an IRA, you have the following four withdrawal options:
- Deposit all or some of the withdrawal into a spending account (e.g., checking account);
- Withhold taxes which may be due on the withdrawal (excluding Roth IRAs);
- Reinvest all or some of the withdrawal in another non-IRA investment account; and/or
- Donate all or some of the withdrawal to charity to help satisfy the required minimum distribution (RMD) and reduce your tax liability.
If you are not sure which withdrawal option(s) to consider, please contact us. We are also available to work with your CPA and/or refer you to a CPA if needed to help determine the most tax-efficient withdrawal method from your IRA.
Your funds can be sent to your account(s) electronically, which is considered a more secure withdrawal method compared to mailing you a check.
Based on the type of IRA withdrawal you want to make, we may recommend one of the following:
- If a broker IRA withdrawal form is required, we prepare the broker’s form for your review. The broker will then send you an email with a link to the form for your approval before processing the withdrawal.
- If no IRA broker withdrawal form is required and your banking instructions are already on file with the broker, you can initiate the withdrawal online if your broker is Schwab. We can also call your broker to initiate the withdrawal if your broker is either Schwab or Fidelity.
- If no IRA broker withdrawal form is required and you are the sole owner of the brokerage account receiving the funds, you can initiate the withdrawal online if your broker is either Schwab or Fidelity. We can also call your broker to initiate the withdrawal.
