Schwab Intelligent Portfolios^®

You can have the following account types:

• Taxable: Individual, Joint Tenant, Tenants in Common, Community Property, Custodial, Revocable Living Trust
• Tax-Advantaged: Traditional IRA, Roth IRA, Rollover IRA, Inherited IRA, SEP-IRA, SIMPLE IRA 

Of course! After considering your options you can choose a Rollover or Roth IRA account, these rollovers are as simple as contacting your former employer plan administrator or custodian and telling them you want a direct rollover of your plan assets.

Next Steps

• Complete any forms required by your plan administrator or custodian.
• Decide how you want your retirement assets distributed.
• Your Schwab rollover specialist can assist you with questions depositing funds into your Schwab Intelligent Portfolios IRA.

Tips:

• To prevent funds from being taxed, the check should be made payable to "Charles Schwab & Co., Inc., FBO (Your Name)."
• For an easy deposit, give your employer your Schwab Intelligent Portfolios IRA account number and ask them to include it on the check.
• Instruct your plan administrator or custodian to mail the check to: Charles Schwab & Co., Inc., PO Box 2339, Omaha, NE 68103.

If you need help, give us a call at 866-855-9102 to talk to a Rollover Consultant. If you are currently a Schwab Plan participant, please call 800-724-7526.

First, you should identify if you want to enroll a taxable or tax-advantaged account into Schwab Intelligent Portfolios. You can see the types of accounts commonly used below. You will need to have this information when you are completing the online questionnaire to receive a portfolio recommendation. 

• Taxable: Individual, Joint Tenant, Tenants in Common, Community Property, Custodial, Revocable Living Trust
• Tax-Advantaged: Traditional IRA, Roth IRA, Rollover IRA, Inherited IRA, SEP-IRA, SIMPLE IRA 

To start the process, visit intelligent.schwab.com and log in. Select Open Account in the left rail. You will enter the online questionnaire to build your portfolio. After you answer all the questions, you will receive a portfolio recommendation. On the next page, select Schwab Intelligent Portfolios, and you will begin the account enrollment process. You will be presented with two options—"Open a new account" or "Enroll an existing Schwab account." Select the latter. On the next page, you will have the ability to select the Schwab account you would like to enroll. Once you follow the prompts to review the appropriate disclosures, your account will be enrolled into Schwab Intelligent Portfolios, and your funds will likely be liquidated from your existing Schwab account and invested into your Schwab Intelligent Portfolios account within 3-5 days.  

Note: if you are interested in a Schwab Intelligent Portfolios Premium account, you'll first need to enroll in a Schwab Intelligent Portfolios account then select "Explore Premium" in the left navigation after log in.

Yes, you can withdraw cash from your account at any time by logging in and selecting "Add/Withdraw Money." If the requested amount is less than the cash allocation in your portfolio, you can transfer it to another Schwab account immediately or to a linked external account overnight. If the withdrawal request exceeds your portfolio's cash allocation, we will sell ETFs to generate the requested amount of cash. The processing and settlement takes between 4-6 business days.

After your withdrawal, your portfolio will be rebalanced to its target asset allocation if it has drifted significantly from the portfolio's original target. Your withdrawal may also cause your account to become ineligible for tax-loss harvesting if you have enrolled in the service and your account falls below the $40,000 minimum.

No, beneficiaries are unique to each account number. You will need to establish new beneficiary instructions for any account you open.

Log in to Schwab.com and navigate to Service > My Profile > Beneficiaries. On this page you can manage your beneficiaries for your eligible accounts.

We are committed to keeping fees low to help you achieve your goals. It starts with not charging an advisory fee or commissions. We can do that because we earn revenue from other sources as detailed below.

• ETFs: Schwab Intelligent Portfolios invests in Schwab ETFs. This creates revenue for Charles Schwab Investment Management, Inc., a Schwab affiliate that receives management fees on those ETFs. Schwab Intelligent Portfolios^® also invests in third-party ETFs, and Schwab also receives compensation for providing shareholder services to those third-party ETFs.
• Cash: We believe cash is a key component of an investment portfolio. Based on your risk profile, a portion of your portfolio is placed in an FDIC-insured deposit at Schwab Bank. Some cash alternatives outside of the program pay a higher yield.
• Order Flow: Schwab receives revenue from the market centers where ETF trade orders are routed for execution.

Yes, the interest rate on cash balances in the Sweep Program is set on the first business day of each month equal to the seven-day yield (with waivers) for the Schwab Government Money Fund – Sweep Shares (symbol: SWGXX) as determined at the end of the prior month. See Current Interest Rates for more details. Some cash alternatives outside of the program pay a higher yield.

No, Schwab Intelligent Portfolios has leveraged the power of technology to automate these complex tasks.

Tax-loss harvesting is available for taxable portfolios with $50,000 or more, and there are no additional fees for activating this feature in your account. You must be enrolled for tax-loss harvesting to occur.

Both Schwab ETFs™ and third-party ETFs are filtered through a carefully selected set of stringent criteria. This ensures that all ETFs chosen for Schwab Intelligent Portfolios deliver both diversity and cost efficiency.

These selection criteria help pare down more than 2,000 ETFs to the 51 that could potentially be part of your Schwab Intelligent Portfolios account. So, let's examine those criteria and see how that works.

Eschewing risk. Any nonstandard ETFs are eliminated—that is, ETFs that are inverse and leveraged, actively managed, that invest only in one country, or those that have less than three months of history, among other factors.

Size matters. Next, all ETFs without sufficient assets under management are stripped out, because ETFs without sufficient assets are at greater risk of closing.

Monitoring consistency. Schwab Intelligent Portfolios ETFs must closely track the indexes our asset allocation models are based on. This measure is not whether the fund outperforms the benchmark, but rather the degree to which it approximates the index and is a good representation of the asset class.

Low OERs are key. Finally, the selection process focuses on ETFs with low operating expense ratios (OERs) while also meeting the size, tracking, and bid-ask spread criteria. (Source: "How to Choose an Exchange-Traded Fund (ETF)," The Wall Street Journal How-To Guide.)

After the ETFs are chosen, Charles Schwab Investment Management, Inc. ("CSIM") monitors their performance quarterly. CSIM also reviews the ETF selection annually to make sure the ETFs available for Schwab Intelligent Portfolios continue to meet the criteria described above, and can provide consistency and diversity.

Please visit the Schwab Intelligent Portfolios Selection Process page for more information and a representative list of ETFs used in Schwab Intelligent Portfolios.

Asset allocation is the foundation of every well-constructed investment portfolio and is at the heart of the advice we at Schwab give when advising clients on their total portfolio. Because it is so important, we have dedicated an entire team of Charles Schwab Investment Management, Inc. ("CSIM"), experienced analysts to continually use state-of-the-art research and evolve our approach to creating asset allocations designed to improve outcomes for individual investors.

Learn More:
Schwab Intelligent Portfolios™ Asset Allocation White Paper
High-Yield Bonds: Why "Risky" Asset Classes Can Help Diversify Risk

The appropriate asset allocation differs from person to person depending on their situation, risk tolerance, and time frame for their investing goals. The table below shows a sample asset allocation for three individual investors ranging from aggressive to conservative.

• Investor 1: A 30-year old who sees herself as aggressive and is saving for retirement. This investor clearly has a long investment horizon (both for starting to withdraw from this portfolio and the period over which she would need to withdraw). The primary goal is capital appreciation (growth), and her investment strategy is Global Aggressive Growth with Taxable Bonds. 
   
• Investor 2: A 40-year-old father whose tolerance for fluctuations in his portfolio value is above average and is using this account to save for the college expenses of his 3-year-old twins. His goal is a combination of capital appreciation, income and being somewhat defensive. His investment strategy is Global Moderate Growth with Taxable Bonds.  
   
• Investor 3: A tax-sensitive 65-year-old retired investor who is living off her portfolio and wants to reduce portfolio volatility. Her primary goal is to generate adequate income starting now, with some potential for capital appreciation to sustain the portfolio over a long-term. Her investment strategy is Income Focused Moderately Conservative with National Muni Bonds. 

Learn more by visiting this asset allocation white paper.

Cash investments play an important role within a well-diversified portfolio and serve several purposes, including:

• Greater stability
• Liquidity
• Diversification
• Potential inflation protection

A cash allocation provides stability to help mitigate downside risk. Lower portfolio risk can help moderate downturns and keep investors focused on their longer-term goals. Cash allocations are determined according to an investor's risk profile, with the most risk-averse or short-term portfolios holding the highest levels of cash and the least risk-averse or longer term ones holding the lowest levels of cash.

Cash in Schwab Intelligent Portfolios provides an additional layer of stability in the form of FDIC insurance of up to $250,000 per depositor as it is "swept" into deposit accounts at Schwab Bank, where it also earns a market rate of interest for highly liquid cash investments.

Every portfolio has a target asset allocation—a combination of stocks, bonds, commodities and cash determined by the investor's stated goals, risk tolerance and time horizon. Over time, however, contributions/withdrawals, gains, and losses cause your portfolio to stray from the original target and become unbalanced.

The solution is rebalancing—the act of periodically buying or selling assets to restore your portfolio to its original target allocations. Schwab Intelligent Portfolios automatically rebalances accounts thanks to an algorithm that adjusts your account when an asset class shifts above or below its target range.

Learn More:
Rebalancing and Tax-Loss Harvesting in Schwab Intelligent Portfolios

The primary purpose of rebalancing is to keep your portfolio's asset allocation consistent with your targeted level of risk as markets fluctuate over time. The recommended allocation for your portfolio is based on your goal, time horizon, and risk profile.

Schwab Intelligent Portfolios are monitored and automatically rebalanced as needed to keep the allocation consistent with the client's risk profile as markets fluctuate over time. Portfolio allocations are not adjusted tactically based on short-term views about the markets. In a normal environment, rebalancing happens a few times per year; during more volatile times, don't be surprised if this number increases.

Tax-loss harvesting can help offset capital gains and lower your taxable income by automatically selling an ETF that has fallen enough below the price you paid for it and replacing it with an alternate ETF in the same asset class to keep your portfolio's allocation consistent.

Periods of elevated market volatility highlight the potential benefit of tax-loss harvesting as the number of these trades have historically surged when markets turn turbulent. The goal of the Schwab Intelligent Portfolios algorithm is to maintain a portfolio that closely tracks the investor's strategic asset allocation and captures tax-deductible losses while generally preventing wash sales in your account. As it’s a complicated and time-consuming process, Schwab Intelligent Portfolios has automated this process.

Learn more:
How Tax-Loss Harvesting Can Help Lower Your Tax Bill
Rebalancing and Tax-Loss Harvesting in Schwab Intelligent Portfolios

The Sweep Program is a feature that allows for the cash allocation in your Schwab Intelligent Portfolios account to earn interest by being "swept" to a FDIC-insured deposit account at Schwab Bank. The interest rate on cash balances in the Sweep Program is set on the first business day of each month equal to the seven-day yield (with waivers) for the Schwab Government Money Fund – Sweep Shares (symbol: SWGXX) as determined at the end of the prior month. See Current Interest Rates for more details. You can view the cash allocation on your portfolio dashboard at Intelligent.Schwab.com. You can withdraw cash from your Schwab Intelligent Portfolios account at any time by logging in to your account and requesting a transfer.