The Fidelity Rewards Amex credit card is one of the popular options for a straight 2% cash back on all purchases.
The one hassle with this card has always been that you have to redeem the rewards into a linked Fidelity account and not as a statement credit or as a deposit to your regular bank account. The card doesn’t actually earn cashback; rather it gets 2 WorldPoints per dollar. These points are almost like cashback and can be redeemed into a Fidelity account at 1¢ per point, with the result being 2% cashback.
It’s really not that bad since you don’t have to redeem the points into a Fidelity investment account; you can just open up a Fidelity Cash Management account, which is identical to a checking account and can be used to pay bills, etc. And you can even have the points ‘swept’ automatically from the credit card into the Fidelity account. Personally, I have my Cash Management account setup with just one payee – my Fidelity credit card; whenever some points are swept into the Cash Management account, I log in and send them over as a payment to the Fidelity credit card.
Redeem for 2% Statement Credit
In any case, a few people have pointed out that there does exist an easy way to cash out the card at an effective 2% rate, even without having to deal with opening any other Fidelity account at all.
When redeeming points for a statement credit, the rate varies by the quantity of points redeemed. When redeeming just 2,500 points, it will yield just $12.50 as a statement credit, versus redeemed into a Fidelity account at $25. However, when you scale up the redemption, a 25,000 point redemption will yield a $250 statement credit – a full 1¢ per point. Using this technique, it’s easily possible to get 2% cash back as a statement credit without dealing with a Fidelity account at all.
This redemption option isn’t necessarily something new, but it’s something that isn’t well known.
It’s also worth noting that some BofA credit cards earn WorldPoints as well, and these can pool with the WorldPoints of your Fidelity Amex card and be cashed out using the method described above.
See also our comprehensive post on WorldPoints here for great info on which cards earn WorldPoints and how to get even better than 2% back by redeeming for travel.
HT: Fatwallet and another blog who covered this recently (can’t remember which)
View Comments (17)
As noted in Dov's comment to the July 18, 2016 post, as a result of the switch to Elan, you can no longer get a one cent value by redeeming for statement credit.Time to open a Fidelity account.
redeeem fidelity points into a fidelity brokerage account ---> pay the fidelity credit card with funds from this brokerage account, OR move funds from brokerage account to bank account.
DONE
I'm doing this 'big' redemption technique for the last 8 years. VERY few people know about it. Fidelity is my default CC when I'm not doing any minimum spending. I accumulate cashback points to fund my big vacation. Last time, a 'free' cruise with $1500 accumulated in about 3 years.
I've heard fidelity has put Amex under review and might rebrand this card as a visa, similar to what Costco will be doing with citi visa in a few months. Any thoughts or substantiation to this?
Only time will tell...
Does this trick still work?
http://milenomics.com/2015/01/redeem-points-using-theflightdeal-com-supercharge-fidelity-rewards-amex/
Check out this post https://www.doctorofcredit.com/bank-of-america-worldpoints-a-forgotten-program-get-up-to-1-76%C2%A2-per-point/
So this leads me to a more odd question.
If you can transfer points between world points cards for redempion, which based on other post you can. Can you put world points earned on a bofa card into a fidelity cash account by transferring the cash to fidelity amex then depositing?
Yes. Tryed both ways between Amex FIA and BOA Travel Rewards.
They work
Thanks for the info. Think I know my next card.
I believe you are able to cash out BofA points using the method you describe.
If only I can get accepted for this card...
a fidelity cash management account is free, and is easy to transfer money into and out of. why not just do that, then use it to transfer to any other bank account and/or then use it to pay off the credit card?
It's just less mental strain to deal with fewer accounts. If I didn't already have the CM account set up, I'd probably use the approach described here.
But certainly it's no major difference.
But in order to do this, you'd have to spend $12,500?! How could this be worth it to wait that long to redeem? Guess ill stick with double cash still.
Right, unless you have some BofA WorldPoints cards, in which case you can combine the balances.
Double Cash is certainly more straightforward.
And Double Cash is a MasterCard so it's accepted in more places. No brainer in my opinion.