Fidelity's Recurring Investments: How Does It Work?

Fidelity offers recurring investments, allowing customers to automate their investments and grow their portfolio. This feature is available for stocks, mutual funds, ETFs, and Fidelity Basket Portfolios. Customers can set the amount, frequency, and timing of their recurring investments, and can easily modify or cancel them if needed. The minimum amount for auto-investing is $10, and the maximum is $100,000 for stocks, ETFs, and baskets, and $100,000 for mutual funds.

Dollar-cost averaging

Fidelity offers recurring investments to help you reach your financial goals. One such strategy is dollar-cost averaging (DCA), which involves investing a fixed dollar amount at regular intervals, regardless of market movements. This strategy can help you benefit from compounding returns and potentially reduce the impact of market volatility.

Fidelity allows you to set up recurring investments in stocks, mutual funds, ETFs, and Fidelity Basket Portfolios. You can choose the amounts, frequency, and timing of your recurring investments and change them as needed. You can also automate deposits and withdrawals from your linked bank account to your Fidelity account.

Automating investments

Automating your investments can be a powerful tool to help you save and invest more. It can also help you stay on track with your savings plan and reduce the temptation to spend. With that in mind, here is a step-by-step guide on how to automate your investments with Fidelity:

Reasons to Automate Your Investments:

• Dollar-cost averaging (DCA): By investing a fixed dollar amount at regular intervals, you can reduce the impact of market volatility and potentially benefit from compounding returns.
• Reduced stress: Automating your investments means you don't have to worry about daily swings in the stock market, allowing you to focus on your long-term investment goals.
• Out of sight, out of mind: By automatically withdrawing money from your bank accounts, you reduce the temptation to spend that money.
• Lack of discipline: Automating your investments ensures that you consistently transfer money into your brokerage account and invest over time, without having to worry about remembering to do it manually.

Steps to Set Up Automatic Investments with Fidelity:

• Prerequisite: Before setting up automatic investments, ensure that you own at least one mutual fund. If not, make a minimum investment in at least one mutual fund to get started.
• Login: Log in to your Fidelity account and go to https://www.fidelity.com/cash-management/automatic-investments.
• Set up Automatic Investments: Click the "Set up Automatic Investments" button, which should take you to https://digital.fidelity.com/ftgw/digital/auto-invest, where you will see a list of your accounts.
• Select Account: Click on the link for the account you wish to set up automatic investing for. A dialog should appear with several options:

• Transfer funds from an external bank account.
• Transfer and then invest funds from an external bank account.
• Invest funds from the core position (funds already in your investment account).

• Transfer and Invest: For this example, we will choose option 3b. Transfer and invest funds from an external bank account. Fidelity will take you to a page to configure your auto-investing schedule.
• Select Bank: If you want to transfer funds from a bank account you haven't used previously, you'll need to follow Fidelity's instructions to set up an electronic funds transfer.
• Transfer From: Choose the bank you wish to transfer money from.
• Transfer To: Select whether you want to transfer to your Brokerage Core Account or directly into mutual funds you own.
• Enter Amount: Decide on the amount you want to automatically transfer and invest from your bank account. You can start with a small amount and increase it later. The minimum amount for auto-investing is $10.
• Investment Schedule: Customize your auto-investing schedule. The default frequencies are monthly or quarterly, but you can also set up daily or weekly schedules by creating multiple schedules.
• Review and Finalize: Review your schedule, make any necessary adjustments, and finalize it. Congratulations! You've successfully set up your automatic investments.

Additional Options for Automating Investments:

Fidelity offers several other options for automating your investments, including:

• Recurring investments from your paycheck: You can set up direct deposits from your paycheck into multiple accounts, including investment accounts.
• Recurring transfers from your bank account: If your investment account is at a different institution, you can set up transfers from your bank account.
• Automated investment plan in your investment account: Fidelity offers automated investment plans, such as robo-advisors and managed accounts, that can invest your money according to your investment plan.
• Dollar-cost averaging: This strategy involves investing equal portions of your money at regular intervals, regardless of market direction. It can help reduce the impact of volatility and serve as a risk management strategy.

Setting up automatic investments

Step 1: Prerequisite

Before proceeding, note that you can currently only auto-invest in mutual funds that you already own. So, if you don't own any mutual funds yet, you'll need to make a minimum investment in at least one mutual fund before setting up automatic investments.

Step 2: Log in to Your Fidelity Account

Go to https://www.fidelity.com/cash-management/automatic-investments and log in to your Fidelity account.

Step 3: Click on "Set up Automatic Investments"

Click on the "Set up Automatic Investments" button, which should take you to https://digital.fidelity.com/ftgw/digital/auto-invest, where you will see a list of your accounts.

Step 4: Set up an Automatic Transfer or Investment

Click on the link for the account you wish to set up automatic investing for. From there, a dialog should appear with the following options:

• Transfer funds from an external bank account: This will simply transfer money from your bank account to your investment account, but it will not invest that cash upon transfer.
• Transfer and then invest funds from an external bank account: This option will transfer money from your bank account and automatically invest it in a mutual fund for you.
• Invest funds from the core position: This option allows you to auto-invest funds already sitting in your investment account.

Step 5: Transfer and Invest Funds from an External Bank Account

For this guide, we will proceed by selecting option 3b. Fidelity will then take you to a page to configure your auto-investing schedule.

Step 6: Set up a New Bank Account (Optional)

If you want to transfer funds from a bank account that you haven't used previously with Fidelity, you'll need to go through Fidelity's step-by-step instructions by clicking on the "Set up Electronic Funds Transfer" link. Once you've added the new bank account, return to the previous page.

Step 7: Select the Bank Account for the Transfer

Select which bank you wish to transfer money from.

Step 8: Choose the Destination Account for the Transfer

This section has two options:

• Your Brokerage Core Account: If you select this option, money will be transferred into your investment account but won't be automatically invested. You will need to manually invest it yourself.
• Mutual funds you own: Selecting this option will automatically invest your transferred funds into a mutual fund that you own.

Step 9: Enter the Amount for Automatic Transfer and Investment

Enter the amount you want to automatically transfer and invest from your bank account. Be careful not to overextend yourself. You can always start small and increase this amount later. The minimum amount you can auto-invest is $10.

Step 10: Set up Your Investment Schedule

This is where you can customize your auto-investing schedule. The frequencies available for selection are monthly or quarterly, but you can also set up multiple schedules to achieve daily or weekly investments.

Step 11: Review and Finalize Your Schedule

Click "Next" to review your schedule and finalize it. After finalizing your schedule, you can review, edit, and even skip specific months if needed.

Step 12: Congratulations!

You've successfully set up your automatic investments!

Investment options

Fidelity offers a variety of investment options to its customers. One of the most popular features is the ability to set up recurring investments. This allows customers to automate their investments and make regular contributions to their investment accounts. With recurring investments, customers can choose to invest in stocks, mutual funds, ETFs (exchange-traded funds), and Fidelity Basket Portfolios.

To set up recurring investments, customers can log in to their Fidelity account and select the "Recurring Activity" or "Recurring Transfers" option. They can then choose the accounts they want to create recurring investments for, set the amounts, frequency, and timing of their investments, and change them as needed.

Fidelity also offers the option to automate investments through direct deposit from their paycheck or recurring bank transfers. This allows customers to establish a regular transfer of funds into their investment accounts, either from their paycheck or their bank account.

In addition to recurring investments, Fidelity provides other investment options such as managed accounts. With a managed account, customers can add extra money at any time through direct deposit or recurring transfers, and the funds will be invested according to their investment plan. Managed account options include a robo-advisor, an all-stock portfolio with tax-loss harvesting, and access to full-service investment professionals.

Fidelity also offers the ability to set up automatic investments into funds, stocks, bonds, ETFs, etc., that customers already own in their brokerage, retirement, or other eligible retail Fidelity accounts. This can be done through the "Automatic Investments" feature on the Fidelity website.

Overall, Fidelity provides a range of investment options to its customers, including recurring investments, automated investments through direct deposit or bank transfers, and managed accounts. These options give customers flexibility and control over their investment strategies and help them work towards their financial goals.

Investment frequency

Fidelity offers recurring investments to help you reach your financial goals. You can choose the frequency, amount, and timing of your recurring investments, and change them whenever you need to. You can set up recurring investments on a weekly, biweekly, or monthly timeframe. You can also set up multiple schedules to achieve daily or weekly investments. For example, you can set up a weekly plan for each day of the week.

To set up recurring investments, you can use the Fidelity website or the Fidelity Mobile® app. On the website, log in to Fidelity.com and go to "Your recurring activity". On the mobile app, select the "Transact" icon and tap "Recurring Transfers & Investments".

Recurring investments can be paid from your Fidelity core (cash) position or your linked bank account. You can invest in stocks, mutual funds, ETFs, and Fidelity Basket Portfolios. You can also set up automatic deposits and withdrawals from your linked bank account to your Fidelity account.

Dollar-cost averaging (DCA) is a strategy where you invest a fixed dollar amount at regular intervals, regardless of the market direction. DCA can help reduce the impact of market volatility and improve your potential for growth over time.

Frequently asked questions