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Fidelity Dangles Rewards Program for Wealthy Retail Clients

The new rewards program is being rolled out to in-house clients with a minimum of $250,000, not the firm's RIA custody business.

Fidelity Investments announced Wednesday that it has rolled out Fidelity Rewards+, a rewards program for its wealth management clients with a minimum of $250,000 to invest. The promotion is not yet available to registered investment advisors who custody with Fidelity.

The offer is available to the firm’s retail clients with assets in Fidelity Wealth Services, its high-net-worth program; Fidelity Strategic Disciplines, its separately managed account program; or both. There are no program enrollment fees, and participants get automatic renewal with qualifying assets, as well as automatic upgrades to higher-benefit tiers. 

The promotion includes the Fidelity Rewards Visa Signature Card, a credit card with up to 3% cash back on purchases and no annual fee; a one-time $75 credit when customers use the card to make any Amazon purchase by Sept. 30; and zero minimums to invest in one of Fidelity’s high-yielding money market funds. Other rewards include identity theft monitoring, up to $5 million in identify theft insurance for the family, and concierge restoration support. And while the firm eliminated trading commissions for stocks, ETFs and options late last year, clients in the rewards program will no longer have to pay contract fees either.

“Fidelity understands that there are various financial firms from which investors can choose, and the Fidelity Rewards+ program is our chance to return their loyalty and thank clients with benefits they will appreciate and use,” a Fidelity spokesperson said in an email.

Charles Schwab and Raymond James offer a similar rewards program for their investors through American Express. Bank of America Merrill Lynch, Wells Fargo, TD Ameritrade and UBS also issue rewards credit cards to their investment clients.

A company spokesperson said Fidelity would “consider expanding eligibility in the future" to other client bases.

Matt Sonnen, the founder and CEO of PFI Advisors, says rewards programs like Fidelity’s would be a great add-on to an RIA’s offering since advisors are looking for ways to compete with the likes of Merrill Lynch and JPMorgan.

“This strategic type of bundling can be a powerful asset gathering tool for advisors,” said Tim Welsh, president of consulting firm Nexus Strategy. “RIAs can target their clients’ outside holdings that they don’t manage at banks and other brokerages to consolidate in order to get these valuable services and benefits for their clients. By doing so, they can increase their AUM and their billings to increase revenues, something desperately needed in these times of declining markets.”
“This type of strategic marketing bundling can result in one of those rare win/win/win trifectas, as clients benefit from value-added services, advisors benefit from increased AUM and Fidelity benefits by grabbing market share from their competitors,” he added.

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