Fidelity has released an infographic [pdf] about the power of saving 1% more of your income:
To coincide with this, Fidelity started a related promotion to entice folks to move over their IRA assets to them. The Fidelity IRA Match is designed to mimic the 401(k) contribution matching that many employers offer, where Fidelity will match between 1% and 10% of your future contribution for 3 years if you roll over $10,000+ to them. Valid for both new and existing Fidelity customers, but only for IRAs and not other account types. Here’s the breakdown:
| Qualifying transfer* | Match rate | Estimated max benefit* (age 50+) |
| $10,000 | 1% | $165 ($195) |
| $50,000 | 1.5% | $247.50 ($292.50) |
| $100,000 | 2.5% | $412.50 ($487.50) |
| $250,000 | 5% | $825 ($975) |
| $500,000 | 10% | $1,650 ($1,950) |
* Qualifying transfers must be rollovers or transfers from non-Fidelity IRAs (Traditional or Roth). Rollovers from workplace savings plans are not eligible for this offer. Estimated max benefit is based on $5,500 annual contribution for three years ($6,500 for age 50+). Max benefit is set at $1,950.
It’s an interesting proposal. Keep in mind that many IRA custodians will ding you with an outgoing transfer fee if you move your money out. Also, Fidelity has other deposit promotions going on that offer a little less than the max payout here, but they are more straightforward bonuses.
To participate, you must register at www.fidelity.com/IRAmatch. If you do participate, I would like to point out the availability of their Fidelity Spartan Index funds, their Fidelity Freedom Index 20XX target-date funds which you can now purchase in an IRA, and their commission-free iShares ETFs. Fido has some good, low-cost products on their menu, but you may have to look for them.
Selected fine print:
This offer is valid for new or existing Fidelity IRA customers. In order for your IRA to be eligible to receive the IRA Match bonus, you must either designate an existing eligible Fidelity brokerage IRA or open a new eligible Fidelity brokerage IRA during the Qualification Period (defined below). Qualifying Deposits (rollovers and transfers from non-Fidelity IRAs) received in the Fidelity IRA during the Qualification Period will result in an annual matching bonus on any subsequent annual contributions made to that IRA for the current contribution year and the next two successive contribution years (the “Match Period”), as follows: deposits of $10,000 to $49,999 may receive a 1% match, deposits of $50,000 to $99,999 may receive a 1.5% match, $100,000 to $249,999 may receive a 2.5% match, deposits of $250,000 to $499,999 may receive a 5% match, deposits of $500,000 or more may receive a 10% match. During the Match Period, the IRA Match bonus will apply for up to three years from when the Match Period begins or until a customer reaches the maximum aggregate IRA Match bonus of $1,950, whichever occurs sooner.
[…] The IRA Match bonus will be calculated on annual IRA contributions made into the qualifying account during the Match Period using the applicable match percentage. Individuals must be eligible to make annual IRA contributions to qualify for the offer and must make an annual IRA contribution in each year in order to receive a corresponding IRA Match bonus for that year.
[…] The IRA Match bonus will be paid directly to the qualifying account. For purposes of this offer, net Qualifying Deposits shall mean total external rollover deposits or transfers (including cash and/or eligible securities) minus assets and/or funds withdrawn or transferred from the account within the Qualification Period.
[…] Account holders must maintain the minimum Qualifying Deposit account balance (minus any losses related to trading or market volatility) at Fidelity for at least nine months from the date on which the bonus award is credited to the account, or Fidelity may charge the account the amount of the bonus award.
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Good post! I have a couple of accounts with Fidelity but don’t have any money to move over to get in on this bonus. Question though…of the Fidelity Spartan Index funds, Fidelity Freedom Index 20XX target-date, and their commission-free iShares ETFs – are there any you specifically recommend?
I have followed some of your guidance with Vanguard funds (VTI, VB, VXUS, VNQ, etc). If I’m a Fidelity customer am I better off switching to any of the funds you mentioned?
Thanks in advance for your help and guidance!
interesting proposal. I’ve got a little over 150k sitting in a Vanguard 401k from a former employer. Any thoughts on overall experience with Vangaurd vs Fidelity?
Correct me if I am wrong, but this is only for IRA rollovers. Not for 401K rollovers. Did I understand you correctly, Jonathan?
Yes, according to the terms, this IRA Match offer is only for IRA to IRA rollovers. The other deposit bonus linked to above counts 401k rollover money (as long as not from Fidelity 401k) and even deposits into a taxable brokerage account.
You could always roll over your 401k balance to an IRA and then roll that IRA into Fidelity to get the bonus, no?
That my friend is what always exists in the financial industry – a loophole ! ; )
I am with Fidelity so can’t participate here but I’m curious if I should switch my investments from the current Vanguard index funds (VTI, VB, VXUS, VFINX) into the various Fidelity funds you mentioned above (Fidelity Spartan Index funds, their Fidelity Freedom Index 20XX target-date funds which you can now purchase in an IRA, and their commission-free iShares ETFs).
Any thoughts? Thanks in advance.
I’m personally happy with Vanguard funds and ETFs for my portfolio. I think you can construct a very similar portfolio at Fidelity but I slightly prefer Vanguard due to their investors-as-owners structure.
Great – thanks for your insight. Love the blog. Keep it up!
Looks like the maximum benefit is +0.39% of your initial money. Thats if you get the max $1950 match on $500k investment money. Over 3 years that amounts to +0.13% a year. I’d compare that extra match to the expense ratios and fees that Fidelity charges to make sure you’re really coming out ahead.
its a bad deal
That’s if you invest in mutual funds. If you invest in stocks, then there is no expense ratio. Or if you just want to buy the US Market, there is SPY (S&P 500), which has expense ratio of 0.09%. But I agree, this may still be a bad deal if you pay more in commissions than what you pay now with for example Interactive Brokers. Or when Robinhood is fully operational with their $0 commission.
I have an inherited IRA and would like to take advantage of the Fidelity IRA Match. My contribution might be $10.000. Question. I will be 72 years old in August 2015. Can I participate in Fidelity Match program ?
Thanks – Gene
My IRA is at Fidelity and they are trying to attract new customers and/or new money to Fidelity by giving matches or bonuses. There does not seem to be any incentives for long loyal Fidelity customers who have made them money. My question is are there other investment firms that will give incentives to move my money from Fidelity to them? Thank you
TD Ameritrade has a promotion going where you can get $ for opening a new account and transferring funds to them. It isn’t huge dollars compared to the balances you would have to transfer, but it’s something. If you move $1 million you get $2500.
https://www.tdameritrade.com/landing-pages/offer/2500/index.html?cid=BNPTDARTMLAP