I wrote earlier about maxing out your Roth IRA, and I just thought I’d post a quick followup regarding how I actually moved the money directly from our savings account at ING Direct ($25 account opening bonus) to my IRA without an intermediary. As anyone with an ING Direct account is likely to know, you can transfer money into/out of any linked checking account from the ING website. This takes a few days, but it works well and can be done from the convenience of your computer. The problem is that ING would have you believe that this is the only way to get money out of your account, and it this step only serves to slow things down if the ultimate destination of your money is somewhere besides the linked account.
But what you may not know is that you can skip the linked account step entirely. As it turns out, you can pull funds from your ING account from pretty much any finanical institution that does electronic transfers. I utilized this little-known functionality the other day to pull funds directly out of ING and into my Vanguard Roth IRA.
So how, exactly, do you do this? At the Vanguard end of things, I set up an electronic transfer using the ING routing number (031176110) and my account number. I specified the amount, and then submitted the request. Two days later, the money is sitting safely in my IRA. Had I gone through the linked account intermediary, it would have taken at least this long to get the money to my bank. I would have then had to write and mail a check, or set up the transfer to pull from the checking account at my bank. This would have added several days to the process, and could create problems, especially if you are facing a deadline.
Note that this same technique seems to work for paying credit cards, or any other sort of bill for which you can initiate transfers from the payee’s website. The only thing that you have to watch out for is that savings account withdrawals are limited to six per month. Don’t go over! It’s also unclear how ING feels about this. It may be that ING will crack down on this behavior if you use it too much. But, until then, it’s certainly a nice approach for moving your money.