This is an excellent topic, because setting up automatic investments is one of the most powerful things you can do for your financial future! It takes the emotion out of investing, promotes discipline, and allows you to harness the magic of dollar-cost averaging and compounding. Let's dive in!
Setting Up Automatic Investments with Fidelity: Your Path to Financial Discipline
Have you ever wished there was a way to invest consistently without having to remember to do it every month, every two weeks, or even every week? What if you could simply set it and forget it, knowing your money is working hard for you in the background? Well, with Fidelity's automatic investment feature, you absolutely can! This guide will walk you through the process, step by step, so you can build your wealth effortlessly.
Step 1: Are You Ready to Automate Your Financial Growth?
Before we even log in, take a moment to consider why you want to set up automatic investments. Is it for retirement? A down payment on a house? Your child's education? Having a clear goal will keep you motivated and help you determine the right amount and frequency for your investments.
Think about it: Automating your investments is like putting your financial goals on autopilot. It removes the temptation to time the market (which rarely works out) and ensures you're consistently contributing, even when life gets busy. Are you ready to take control of your financial destiny, one automated investment at a time? If so, let's proceed!
Step 2: Accessing the Recurring Investments Feature
Fidelity has made it quite straightforward to find the recurring investment setup. You have a couple of options, depending on whether you prefer the website or the mobile app.
Sub-heading: Via the Fidelity Website (Recommended for First-Time Setup)
This method often provides a more comprehensive view and easier navigation for initial setup.
Log In to Your Fidelity Account: Open your web browser and go to Fidelity.com. Enter your username and password to log in.
Navigate to "Accounts & Trade": Once logged in, look for the main navigation bar, usually at the top of the page. Hover your mouse over or click on "Accounts & Trade."
Select "Recurring Investment" (or similar): From the dropdown menu, you'll typically find an option like "Recurring Investment" or "Transfers" > "Manage recurring transfers." Fidelity sometimes updates its interface, so look for keywords like "recurring," "automatic," or "transfers." A reliable path is often: Accounts & Trade > Recurring Investment.
Sub-heading: Via the Fidelity Mobile App
If you're on the go and prefer using your smartphone or tablet, the Fidelity app offers a streamlined process.
Open the Fidelity App: Launch the Fidelity Investments app on your mobile device.
Log In: Enter your credentials or use biometric login (Face ID/fingerprint) if enabled.
Tap the "Transact" Icon: At the bottom of the screen, you'll usually see a navigation bar. Look for the "Transact" icon (often represented by a dollar sign or arrows).
Select "Recurring Transfers & Investments": Tap on this option.
Choose "Create": You will then be prompted to "Create" a new recurring investment plan.
Step 3: Defining Your Investment Plan
This is where you tell Fidelity what to invest, how much, and how often.
Sub-heading: Choose Your Security Type
Fidelity offers flexibility in what you can automatically invest in.
Stocks/ETFs: You can set up recurring investments for individual stocks and Exchange-Traded Funds. This is a great way to build positions in companies or diversified ETFs over time.
Mutual Funds: If you prefer a professionally managed and diversified portfolio, mutual funds are an excellent choice for recurring investments. Fidelity has a vast selection, including their popular index funds with zero expense ratios.
Fidelity Basket Portfolios: This newer feature allows you to create a "basket" of stocks and ETFs that you can manage as a single investment. You can then set up recurring investments into this basket, making diversification even easier.
Sub-heading: Select Your Account and Investments
Choose an Account: Select the specific Fidelity account where you want these automatic investments to occur (e.g., your Roth IRA, individual brokerage account, etc.).
Enter Ticker Symbols (for Stocks/ETFs/Baskets): If you're investing in specific stocks, ETFs, or a Basket Portfolio, you'll need to enter their ticker symbols. You can usually add up to 10 symbols at a time. If you don't know the ticker, there's typically a search function next to the input field.
Select Mutual Funds: For mutual funds, you'll search for them by name or ticker and add them to your plan. Note: For some mutual funds, an initial manual purchase might be required before you can set up recurring investments into them.
Sub-heading: Determine Your Dollar Amount and Frequency
This is the core of your automation!
Enter the Dollar Amount: Specify the exact dollar amount you wish to invest in each selected security during each cycle. Fidelity's system works on dollar-cost averaging, so you'll specify the dollar amount, not the number of shares.
Select a Frequency: Choose how often you want these investments to occur. Common options include:
Weekly
Every 2 weeks (Bi-weekly)
Monthly
Quarterly (less common for direct investment, but sometimes available for transfers)
Sub-heading: Set Your Start Date and Funding Source
Choose a Start Date: Select the day you would like your automatic investments to begin. Be mindful of holidays; if your chosen date falls on a holiday or weekend, the investment will typically execute on the next business day.
Select Funding Source: You have two primary options here:
Linked Bank Account: This is often the most convenient method. You can directly pull funds from your external bank account to fund your recurring investments. Ensure your bank account is already linked to your Fidelity account. If not, you'll need to set that up first (usually via the "Move Money" section).
Fidelity Account Balance (Core Position): If you prefer to first transfer money to your Fidelity account's core position (your uninvested cash), you can choose to fund your recurring investments from there. If you use this method, remember to also set up a recurring transfer from your bank into your Fidelity core position to ensure funds are available. It's often recommended to schedule your transfer a few days before your investment to ensure funds have settled.
Step 4: Review and Confirm Your Plan
This is a critical step to ensure everything is set up correctly.
Preview Details: Fidelity will present a summary of your recurring investment plan. Carefully review all the details: the selected account, the investments, the dollar amounts, the frequency, the start date, and the funding source.
Check for Accuracy: Double-check ticker symbols, amounts, and dates. A small error here could lead to investing in the wrong security or at the wrong time.
Confirm: Once you are satisfied that all the information is accurate, click the "Confirm" or "Submit" button. You'll typically receive a confirmation message on screen and often an email confirmation.
Step 5: Managing Your Automatic Investments
The beauty of automatic investments is that they run themselves, but you still have full control to modify or cancel them if your financial situation or goals change.
Sub-heading: Adjusting Your Plan
Navigate to Recurring Activity: Go back to the "Accounts & Trade" section on the website or "Transact" on the app, and then to "Recurring Investment" or "Manage recurring transfers."
Locate Your Plan: You'll see a list of your active recurring investment plans.
Edit or Delete: You'll typically find options to "Edit" (to change amounts, frequency, or investments) or "Delete" (to stop the plan entirely) next to each entry.
Flexibility is key: You can easily adjust the dollar amounts if your income changes, or even pause investments temporarily if needed.
Sub-heading: Monitoring Your Progress
Regularly check your Fidelity portfolio to see how your automatic investments are growing. This can be a great motivator! You'll see the individual transactions as they occur, contributing to your overall portfolio balance.
Benefits of Automatic Investments with Fidelity
Dollar-Cost Averaging: By investing a fixed amount regularly, you buy more shares when prices are low and fewer when prices are high. This strategy averages out your purchase price over time, reducing the risk of investing a large sum at a market peak.
Discipline and Consistency: It removes the emotional aspect of investing. You're less likely to procrastinate or try to "time the market."
Compounding Returns: Consistent investments, especially in growth-oriented assets, allow your earnings to generate further earnings, leading to significant wealth accumulation over the long term.
Convenience: Once set up, it runs on autopilot, saving you time and mental effort.
Flexibility: Easily adjust or stop your investments as your financial situation evolves.
10 Related FAQ Questions
Here are some quick answers to common questions about setting up automatic investments with Fidelity:
How to choose the right investments for automatic investing?
Focus on broadly diversified, low-cost mutual funds or ETFs that align with your risk tolerance and long-term goals. Fidelity's own index funds (e.g., FZROX for total market, FXAIX for S&P 500) are popular choices.
How to link a bank account to Fidelity for automatic investments?
Log in to Fidelity, go to "Move Money," then "Link a Bank Account." You'll typically need your bank's routing number and your account number. Instant verification is often available, or you may need to verify small deposits.
How to change the amount of my recurring investment?
Log in to Fidelity, navigate to "Accounts & Trade" > "Recurring Investment" (or "Manage recurring transfers"), find the plan you want to modify, and click "Edit" to adjust the dollar amount.
How to change the frequency of my automatic investments?
Similar to changing the amount, go to your recurring investment plans under "Accounts & Trade" or "Transact" in the app, select "Edit," and then choose your desired new frequency (weekly, bi-weekly, monthly, etc.).
How to stop or cancel an automatic investment plan?
Access your recurring investment plans through "Accounts & Trade" or the "Transact" section of the app, locate the plan, and select the "Delete" or "Cancel" option.
How to ensure I have enough money in my account for automatic investments?
If you're pulling from a linked bank, ensure your bank account has sufficient funds. If you're pulling from your Fidelity core position, set up a recurring transfer from your bank to your Fidelity account a few days before your investment date.
How to invest in multiple funds/ETFs automatically with Fidelity?
When setting up your recurring investment, you can typically add multiple ticker symbols (for stocks/ETFs) or select multiple mutual funds within a single plan, allocating a specific dollar amount to each.
How to set up recurring investments for a specific date of the month?
During the setup process, you will be prompted to choose a specific start date. The system will then automatically schedule subsequent investments based on your chosen frequency from that date.
How to find my Fidelity core position?
Your core position is the default cash management option in your Fidelity brokerage account. You'll see its balance listed as part of your overall portfolio when you log in.
How to view the history of my automatic investments?
You can typically view your transaction history by selecting your account from your portfolio overview and then navigating to the "Activity & Orders" or "History" section. This will show all your automated purchases.
