Fidelity IRA Review

Fidelity offers everything you could possibly need to manage your investments for life, and much of it is completely free. You can create a completely fee-free diversified retirement portfolio (you can't do this anywhere else).

Savers who invest in Fidelity ZERO index mutual funds pay nothing at all in management fees. Not even Vanguard can compete with Fidelity’s unheard-of 0% management fees and rock-bottom $0 minimum investment requirement. That said, ZERO funds are only available at Fidelity and aren’t transferable to another broker, which means you'll be shackled to your Fidelity account until you’re ready to sell your shares. But I’m willing to bet most investors won’t mind.

Fidelity IRA pros & cons

Retirement account types

Fidelity offers everything from the standard Roth IRAs and traditional IRAs to ones designed for the self-employed (SEP IRAs), small-business owners (SIMPLE IRA), and even minors who have earned income (Fidelity Roth IRA for Kids, which is a custodial IRA). The $0 account minimum means anyone can set up an IRA at Fidelity and pad a nest egg at their leisure.

IRA customer service is Fidelity’s specialty. Instead of merely sending me to an FAQ page for answers, the broker practically begged me to contact them.

Fidelity experts are — quite literally — a phone call away with free help on even complex IRA flavors with knotty tax rules. And unlike some companies that make you excavate the entire site to find its digits (one of our reviewer’s frustrations with Vanguard), Fidelity plasters its 800 number all over the site. There’s even a team of Fidelity reps fielding questions on Reddit.

This level of service can help customers avoid costly missteps. Dealing with an inherited IRA? A Fidelity inheritance specialist will guide you through the process of handling an account left to multiple beneficiaries, and even assist with setting up required minimum distributions. Same deal with handling Fidelity Roth IRA conversion, and backdoor Roth IRAs, or setting up a Fidelity SIMPLE IRA.

» See our primer on the various types of IRAs.

Fidelity IRA fees

The skinny on IRA fees at Fidelity is this: There are none. Unless you hire Fidelity to manage your portfolio, you’ll pay no IRA maintenance, closure, or even IRA transfer fees. For comparison, Charles Schwab, E*TRADE and Merrill Edge customers pay a $50-$75 transfer-out fee when they dare to move their money to another brokerage.

All trading commissions on stocks and exchange-traded funds (ETFs) are $0 at Fidelity with a few exceptions: Transaction-fee mutual funds carry a $49.95 fee, which is easily avoidable by purchasing any of the thousands of no-transaction-fee (NTF) mutual funds available from Fidelity and other companies. (It’s $74.95 at Schwab.) A $49.95 short-term trading fee also applies if you sell a non-Fidelity NTF mutual fund less than 60 days after buying it, which is in line with industry standards.

» Dive deeper: See more on how much it costs to open an IRA.

Self-directed investment options

Investors who have only encountered Fidelity in their 401(k)s may assume the broker isn’t as nimble as the newer, flashier brokers on the block. Big mistake. In fact, Fidelity blows away the competition with one product that, I’d argue, could be the foundation for a self-directed IRA investor’s portfolio: Fidelity ZERO mutual funds.

Fidelity fee-free index mutual funds: We’re not just talking about $0 investment fees here. Fidelity’s ZERO mutual funds charge no management fees at all. For comparison, even Vanguard — the famed low-cost index fund pioneer — charges 0.04%-0.18% in management fees on comparable funds. Plus, Vanguard index funds require a $3,000 minimum investment versus no investment minimum at Fidelity.

The four Fidelity ZERO funds cover every asset class you need to build a diversified retirement portfolio. Each fund — Large Cap Index Fund (FNILX), Total Market Index Fund (FZROX), Extended Market Index Fund (FZIPX), International Index Fund (FZILX) — is designed to track underlying benchmark indices (think: S&P 500, total stock market index, etc.) and have done so with only slight variations since inception.

What’s the catch? Trust me, I’ve been looking for the gotchas since Fidelity rolled out ZERO funds in 2018. The only potential drawback (if you can call it that) is that ZERO funds must be held in a Fidelity account and are not transferable to another broker. If you ever decide to ditch your Fidelity IRA and move your money to another broker, you’ll be forced to liquidate your ZERO shares. The good news: Selling it in an IRA won’t trigger any tax consequences if you move the money to the same kind of IRA at another brokerage.

Fractional shares: Fidelity’s Stocks by the Slice lets IRA investors build a portfolio of stocks for as little as $1 at a time — and no trading commission — through the Fidelity Mobile app. Instead of coming up with the entire amount to buy a share of stock, you can buy a fraction of a share for a set dollar amount. (For example,, $50 gets you 1/10th of a share of a stock that trades for $500). Simply choose “dollars” instead of “shares” in the drop-down menu on the trading screen, add put your loose change to work.

Fidelity offers fractional shares in more than 7,000 U.S. stocks and ETFs, a number that’s exceeded only by Interactive Brokers’ lineup of 10,000-plus. For comparison, Schwab’s Stock Slices are limited to the 500 companies in the S&P 500 index (a $5 minimum applies), Vanguard allows it for Vanguard ETFs only) and Robinhood allows fractional purchases in stocks worth over $1 per share and a market capitalization of $25 million and higher. E*TRADE and Merrill Edge do not offer fractional share trading.

Other investments: Customers can trade stocks and exchange-traded funds (ETFs) for $0. Plus Fidelity offers thousands of no-commission mutual funds, and more than 500 $0 minimum funds (from Fidelity and other companies). Although crypto isn’t tradeable in a Fidelity IRA, you can invest in crypto-focused ETFs. For the fixed-income portion of your portfolio, Fidelity offers bonds, U.S. Treasury bills (including TIPS), and certificates of deposit with low fees. That said, if you are interested in trading crypto, check out our overall Fidelity review – crypto trading is available to Fidelity's brokerage clients.

Managed investment options

Fidelity has a slew of investment management services to serve every type of IRA investor based on how hands-on you want to be in choosing investments and if you want access to retirement planning help. Fees range from 0%-0.35% of assets under management for Fidelity’s basic Fidelity Go robo advisor service (my recommendation for those with smaller IRA balances), to FidFolios’ 0.4%-0.7% fee for a customizable portfolio of stocks and American depository receipts (ADRs).

Fidelity Go: Customers with balances less than $25,000 pay nothing ($0!) in management fees for Fidelity Go to build a set-it-and-forget-it IRA portfolio. Based on your savings goals and where you fall on the conservative-to-aggressive spectrum, Fidelity invests your money proportionally across asset classes (large companies, small ones, bonds, and international) using a mix of no-management-fee Fidelity Flex funds.

True, you could invest directly in ZERO funds on your own through your Fidelity IRA account. (Flex Funds are only available through Fidelity’s managed portfolio services.) But Fidelity Go’s algorithm automatically rebalances your holdings over time to stay in line with your chosen investment strategy, saving you the hassle of figuring it out on your own. The low $10 investment minimum beats Vanguard Digital Advisor’s $3,000 minimum. Plus, it’s hard to beat the low, low price of $0 expense ratios.

Fidelity Go is less of a slam dunk once your IRA balance exceeds $25K. That’s when a 0.35% annual advisory fee (and access to one-on-one financial coaching) kicks in, which is higher than similar automated portfolio services at Vanguard (0.15%-0.20%), E*TRADE (0.30%), Wealthfront (0.25%) and Betterment (0.25%). Account minimums and additional services vary across advisors.

Fidelity Managed FidFolios: FidFolios ($5,000 minimum) are best for investors who want a professionally managed IRA portfolio of 85-350 holdings with the choice between a direct indexing strategy (0.40% management fee, or an actively managed strategy (0.70%) that seeks to beat a benchmark.

Two notable ways that FidFolios differ from Fidelity Go:

1. Customization: FidFolios allow customers can exclude up to five individual stocks or two industries from their FidFolios. It also gives savers an eco-friendlier ESG portfolio option.
2. Advisor access: FidFolios don’t include it, whereas Fidelity Go customers with $25,000 or more are eligible for unlimited one-on-one financial coaching on topics like budgeting, debt and retirement planning. If you want an actively managed portfolio and retirement planning input, you must upgrade to Fidelity Advisory Services, which carries a 1.10% management fee.

Retirement planning tools

Please clear your calendar: You’re going to want to spend some quality time playing with Fidelity’s retirement planning tools. Some of my personal favorites, all of which are free even if you don’t have Fidelity account:

Fidelity Retirement Score: This tool provides a numerical grade and gentle judgment (from “Needs Attention” to “On Target”) based on your age, income, current savings, desired standard of living, investment style and planned retirement age. Note: The free public calculator is cool/terrifying on its own. The turbo-charged version Fidelity customers can access automatically incorporates your Fidelity account balances and lets you account for savings outside of Fidelity. Plus it includes other factors (say, additional income you expect to earn in your dotage) and more.

Roth IRA conversion calculator: If you’re considering converting a traditional, rollover, SEP or SIMPLE IRA to a Roth IRA, Fidelity will estimate the tax impact today and in the future. (Pro tip: Have your recent federal and state income tax returns handy.)

Doing an IRA rollover with Fidelity

What strikes me about Fidelity’s IRA rollover support is how extra it is. Fidelity’s step-by-step rollover instructions anticipate any possible glitch a customer might encounter when transferring an old 401(k) into an IRA.

Wondering what exactly to request from your old plan administrator when you call them? Fidelity provides a list of questions or you can request a rollover specialist to make the call with you. Thwarted by slight discrepancies in the name listed on your old account and the new one you set up at Fidelity? Oh, hey, there’s a form for that.

Some notable extras Fidelity provides IRA customers:

Rollover phone-a-friend: If you need a rollover buddy, a Fidelity specialist will hop on the line with you and your old 401(k) or 403(b) plan administrator to ensure a smooth rollover. This is especially helpful if you have shares of company stock in your old 401(k). (FYI: The direct line to Fidelity’s rollover specialists is 800-343-3548.)

Transfer status tracker: Rollovers can take time, anywhere from days (if your old 401(k) was with Fidelity) to three to five weeks (e.g., if your old account administrator doesn’t accept electronic transfer requests). Fidelity’s transfer status tracker gives you something to maniacally click on while you wait. Don’t worry, you’ll be notified when the transfer is complete.

Fidelity may reimburse IRA closeout fees charged by your old account. Fidelity will cover the Transfer of Assets (TOA) fee some workplace retirement plans hits ex-customers with as a parting shot for new clients who transfer $25,000 or more into a Fidelity account. Fidelity will also foot the bill for existing customers, decided on a case-by-case basis. My advice: Call and ask.

Bottom line

A colleague of mine called Fidelity a “stockpicker paradise” for equity investors. I’ve come to a similar conclusion when assessing Fidelity’s IRA game. (“IRA Eden,” anyone?) Its garden of IRA delights offers everything a long-term investor should look for in a provider: low-cost, highly rated mutual funds and ETFs (from Fidelity and other providers), its own zero-management fee index funds, $0 commissions and account fees, and a level of customer service to help take an IRA from seedling to retirement income stream.

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