Fidelity introduced today a new benefits program for actively managed wealth management clients. It’s called Fidelity Rewards+.
Direct Link to Fidelity Rewards+
Overview
Fidelity launched today the Fidelity Rewards+ program for wealth management customers which offers up to 3% cashback on the Fidelity credit card (instead of 2%), free options trading, higher-yield funds, and identity protection. There’s also a time-limited $75 signup bonus.
There are three tiers of benefits:
- Gold for those with between $250,000 and $1M in assets
- Platinum for those with between $1M-$2M in assets
- Platinum Plus for those with $2M+ in assets
It’s free to join Fidelity Rewards+, and benefits are kept for 1 full year and renew automatically.
Benefits
- Fidelity offers the 2% Fidelity Rewards Visa Signature card which has no annual fee. Fidelity Rewards+ members can earn up to an additional 1% for a total of 3% cash back on everyday purchases that can be added to any eligible Fidelity investment account.
- Gold members get 2.25%
- Platinum members get 2.50%
- Platinum Plus members get 3%
- Fidelity Rewards+ members can invest in many of their highest yielding money market funds without the typical investment minimums, providing the potential to earn more.
- Fidelity Rewards+ members get access to three layers of ID protection: up to $5M in identity theft insurance for the whole family, access to a suite of 24/7 advanced credit and identity monitoring services that alerts the customer if a breach is detected, and concierge restoration service to recover and restore a customer’s identity, should they ever need it.
- Fidelity Rewards+ members can trade options online free from contract fees for up to an unlimited amount of trades.
- Gold members get 100 free trades per year ($65 value)
- Platinum members get 250 free trades per year ($162.50 value)
- Platinum Plus members get unlimited free trade per year (variable value)
$75 Signup Bonus
Be one of the first 10,000 to enroll in Fidelity Rewards+ and you’ll get a $75 credit when you make any Amazon purchase (no minimum) using the Fidelity Rewards Visa Signature Card by 9/30/20.
Our Verdict
The 3% is a nice benefit, and the free options can be a real money-saver to those who trade options. The big catch here – aside from the actual money requirement – is that there is an annual advisory fee of .5%-1.25%; on $2M it would amount to around $20,000 per year. It’s highly unlikely to be worth a $20,000 annual fee in order to get the extra 1% cashback on the credit card and some free options trading.
This new program rivals others like the Bank of America Preferred Rewards program which offers up to 2.62% cashback on all purchases for relationship customers. There aren’t any other credit cards that earn 3% across the board. On the other hand, Bank of America counts passively invested funds and retirement funds in their balance tier requirements, so there’s no cost to get the benefits, making much more useful to a lot of people.
Some people might want an active investing manager (not something I’d typically recommend, but there are probably scenarios where it could make sense), and then the 3% credit card cashback rate would be an added little bonus. Overall, I don’t see this program as being useful to many people.
Hat tip to my friend Jon
