Fidelity as one stop shop for life?

[F.I.R.E User]

Hello F.I.R.E Team.

Hello. I have my pre tax 401k and Roth in plan conversion, Roth IRA, ESPP, BrokerageLink (currently, no investments) at Fidelity.

What I gathered so far is the best strategy is to convert VTSAX to VTI at Vanguard (Vanguard online account has this option). This will guarantee I will NOT get a tax event/fees correct? After this, create a taxable account at Fidelity and do an in-kind transfer from VTI Vanguard to taxable Fidelity account and then keep buying VTI (Again, with no taxable/fees event)?

I also read that it is not a good idea to buy a zero cost fund like FZROX in a taxable account and buying VTI ETF is the most tax efficient compared to FSKAX in a taxable account?

Do you think it’s a good strategy to have all my accounts at Fidelity for life?

What do you all experts advice me to do?

 

[Dtail]

Hello F.I.R.E Team.

Hello. I have my pre tax 401k and Roth in plan conversion, Roth IRA, ESPP, BrokerageLink (currently, no investments) at Fidelity.

What I gathered so far is the best strategy is to convert VTSAX to VTI at Vanguard (Vanguard online account has this option). This will guarantee I will NOT get a tax event/fees correct? After this, create a taxable account at Fidelity and do an in-kind transfer from VTI Vanguard to taxable Fidelity account and then keep buying VTI (Again, with no taxable/fees event)?

I also read that it is not a good idea to buy a zero cost fund like FZROX in a taxable account and buying VTI ETF is the most tax efficient compared to FSKAX in a taxable account?

What do you all experts advice me to do?

Do you think it’s a good strategy to have all my accounts at Fidelity for life?

I will just comment on the last sentence.
My family has most but not all of our accounts at Fidelity. In terms of investment accounts, I personally DO NOT subscribe to the concept of the need to spread out the risk to Vanguard and Schwab as an example.
Irrespective of individual firms going down in 2008, I don't feel that is comparable to the possibility of Fidelity going down while Schwab and Vanguard remain.
Just my opinion.

 

[F.I.R.E User]

I will just comment on the last sentence.
My family has most but not all of our accounts at Fidelity. In terms of investment accounts, I personally DO NOT subscribe to the concept of the need to spread out the risk to Vanguard and Schwab as an example.
Irrespective of individual firms going down in 2008, I don't feel that is comparable to the possibility of Fidelity going down while Schwab and Vanguard remain.
Just my opinion.

So what happens if a firm goes down? Our funds are still protected right?

 

[COcheesehead]

“you think it’s a good strategy to have all my accounts at Fidelity for life?”

That’s my plan.

Consolidation makes you a better client to the brokerage. I have gotten some nice perks from Fidelity because of my account level.
Reporting and tracking are far easier and no risk of losing historical data.
Tax time is a breeze

But what about concentration risk?

Keep a local checking account. Keep high limits on your credit cards. Use ALL the security features available to you. Don’t answer calls or emails from people not in your contacts. Don’t click links in emails or texts.

 

[F.I.R.E User]

“you think it’s a good strategy to have all my accounts at Fidelity for life?”

That’s my plan.

Consolidation makes you a better client to the brokerage. I have gotten some nice perks from Fidelity because of my account level.
Reporting and tracking are far easier and no risk of losing historical data.
Tax time is a breeze

But what about concentration risk?

Keep a local checking account. Keep high limits on your credit cards. Use ALL the security features available to you. Don’t answer calls or emails from people not in your contacts. Don’t click links in emails or texts.

Do you have all your accounts with Fidelity?

Better client? How? You mean I will get special treatment?

What kind of nice perks?

Concentration risk?

I have a checking account at Wells Fargo. They have a local branch here.

 

[COcheesehead]

Do you have all your accounts with Fidelity?

Better client? How? You mean I will get special treatment?

What kind of nice perks?

Concentration risk?

I have a checking account at Wells Fargo. They have a local branch here.

Yes, we have all our accounts at Fidelity along with a local checking account.

Perks? If you have a million or two at three brokerages, you are looked at as a million or two dollar customer, but if you have 3 - 6 million at a single brokerage, you’ll be at a different client service level.

What are the perks?
I received everything from free estate planning, dedicated customer service phone number, access to specialists at no charge (very helpful when my wife set up an non profit), Apple gift cards, transfer bonuses, free tax software, and a few other freebies.

 

[F.I.R.E User]

Yes, we have all our accounts at Fidelity along with a local checking account.

Perks? If you have a million or two at three brokerages, you are looked at as a million or two dollar customer, but if you have 3 - 6 million at a single brokerage, you’ll be at a different client service level.

What are the perks?
I received everything from free estate planning, dedicated customer service phone number, access to specialists at no charge (very helpful when my wife set up an non profit), Apple gift cards, transfer bonuses, free tax software, and a few other freebies.

So far I just have a taxable at Vanguard with less than $150k but over a million at Fidelity. Started in 2007 with employer 401k. I think I do have dedicated customer service where you enter a code. One thing I like about Fidelity is that their agents are very knowledgeable like every single time I call. They know their stuff and never in a rush. I suppose it also comes with their high stress, well paid and pressure to meet their metrics kinda job. I do know Fidelity waived all my fees when I transferred my Roth IRA from Edward Jones (yeah, I was delusional for 15 years getting ripped off on 5.75% front load fee and high ER).

Can you also answer my other questions I listed?

 

[jldavid47]

My family has most but not all of our accounts at Fidelity. In terms of investment accounts, I personally DO NOT subscribe to the concept of the need to spread out the risk to Vanguard and Schwab as an example.
Irrespective of individual firms going down in 2008, I don't feel that is comparable to the possibility of Fidelity going down while Schwab and Vanguard remain.
Just my opinion.

The risk of the firm going down isn't the concern. The risk is the account(s) getting hacked or Fidelity (or any other broker) getting hacked or having an incident (e.g. a persistent DDoS attack) where you are unable to access your funds for some period of time. I believe in having SOME (even 10%) of my funds in other institutions so that access to funds isn't completely cut off. In our case we have our investments split between Schwab (most) and another firm and have about 12 months of living expenses split between 2 banks (mostly in relatively high yielding savings accounts and short-term CDs). That's as complicated as I want it at my age.

I realize the probability of an adverse event where access to funds would be cut off for any period of time is very small. But it isn't zero. YMMV.

 

[F.I.R.E User]

The risk of the firm going down isn't the concern. The risk is the account(s) getting hacked or Fidelity (or any other broker) getting hacked or having an incident (e.g. a persistent DDoS attack) where you are unable to access your funds for some period of time. I believe in having SOME (even 10%) of my funds in other institutions so that access to funds isn't completely cut off. In our case we have our investments split between Schwab (most) and another firm and have about 12 months of living expenses split between 2 banks (mostly in relatively high yielding savings accounts and short-term CDs). That's as complicated as I want it at my age.

I realize the probability of an adverse event where access to funds would be cut off for any period of time is very small. But it isn't zero. YMMV.

Data breaches are common. They happen all the time but everytime they ensure our info is protected.

What about my other questions?

 

[COcheesehead]

The risk of the firm going down isn't the concern. The risk is the account(s) getting hacked or Fidelity (or any other broker) getting hacked or having an incident (e.g. a persistent DDoS attack) where you are unable to access your funds for some period of time. I believe in having SOME (even 10%) of my funds in other institutions so that access to funds isn't completely cut off. In our case we have our investments split between Schwab (most) and another firm and have about 12 months of living expenses split between 2 banks (mostly in relatively high yielding savings accounts and short-term CDs). That's as complicated as I want it at my age.

I realize the probability of an adverse event where access to funds would be cut off for any period of time is very small. But it isn't zero. YMMV.

I can’t offer advice on your other questions.

 

[Dtail]

The risk of the firm going down isn't the concern. The risk is the account(s) getting hacked or Fidelity (or any other broker) getting hacked or having an incident (e.g. a persistent DDoS attack) where you are unable to access your funds for some period of time. I believe in having SOME (even 10%) of my funds in other institutions so that access to funds isn't completely cut off. In our case we have our investments split between Schwab (most) and another firm and have about 12 months of living expenses split between 2 banks (mostly in relatively high yielding savings accounts and short-term CDs). That's as complicated as I want it at my age.

I realize the probability of an adverse event where access to funds would be cut off for any period of time is very small. But it isn't zero. YMMV.

True, that is why we don't have all our accounts at Fidelity, which includes non brokerage type accounts. Thus access to these monies is easy.
Access to Fidelity is not really an issue, unless it happens on one of the around 15 days a year that a transaction is initiated. Buy and Hold and all that stuff.

 

[F.I.R.E User]

True, that is why we don't have all our accounts at Fidelity, which includes non brokerage type accounts. Thus access to these monies is easy.
Access to Fidelity is not really an issue, unless it happens on one of the around 15 days a year that a transaction is initiated. Buy and Hold and all that stuff.

Billions of assets are stored at Fidelity. I am sure they have it figured out. Most likely plan b for us.

 

[RetiredHappy]

We have all our investments in Fidelity and another $50K to $100K in BOA for our banking needs.

 

[foxfirev5]

Personally I use Fido and VG. While I've had good luck with both I've seen plenty of instances of problems with both. Numerous family member estates back in PA were delayed at VG. Not sure I'm buying the old "in order to protect and better serve you" line.
However I see a number of online complaints about Fido freezing accounts. Sign of the times I guess. Anyway it's the old *don't keep all your eggs in one basket" philosophy for me.

 

[Koolau]

I have little "fear" of keeping virtually all my Roth and Taxable MFs at Vanguard, but I also have signifiant investments in my 401(k) as well as several other relatively small fund holders. That way, if Vanguard should choose to freeze my funds for some reason, I'll still have access to other funds until the freeze is thawed out.

 

[F.I.R.E User]

We have all our investments in Fidelity and another $50K to $100K in BOA for our banking needs.

Personally I use Fido and VG. While I've had good luck with both I've seen plenty of instances of problems with both. Numerous family member estates back in PA were delayed at VG. Not sure I'm buying the old "in order to protect and better serve you" line.
However I see a number of online complaints about Fido freezing accounts. Sign of the times I guess. Anyway it's the old *don't keep all your eggs in one basket" philosophy for me.

I have it at WF for checking only.
It’s not the same as buying a single stock for retirement.

 

[MRG]

I've been locked out of my brokerage account for several months after my DFs estate did a TOD to it. Commonwealth of Pennsylvania made sure they got ten% from his estate.

I worked in the industry in technology and it's worth it to divide my assets between multiple providers. Accounts get hacked, providers have issues. Sometimes they go on system wide longer than anyone outside knows about. Megacorp had nonstop DDOS attacks daily.

No I don't worry about Fidelity or other providers going under..

 

[Al18]

Fidelity freezing accounts? There was an increase in fraud activity in 2024, so a small number of accounts were temporarily frozen. I’ve not seen any new info since.

 

[F.I.R.E User]

So I K

I've been locked out of my brokerage account for several months after my DFs estate did a TOD to it. Commonwealth of Pennsylvania made sure they got ten% from his estate.

I worked in the industry in technology and it's worth it to divide my assets between multiple providers. Accounts get hacked, providers have issues. Sometimes they go on system wide longer than anyone outside knows about. Megacorp had nonstop DDOS attacks daily.

No I don't worry about Fidelity or other providers going under..

So I am safe with Fidelity for life?

Can you answer my other questions in the topic?

 

[MRG]

The only one is the FZROX . You can't transfer it anywhere else so you can have tax issues.

As far as being safe with Fidelity for life, I never said that. I keep half our assets in a separate provider.

 

[frank05]

Like with FDIC limits, there are limits on SPIC coverage. There is no coverage on crypto.

 

[kevink]

We keep most of our investments at Fidelity and use them as our primary "bank" (we charge everything we can to their cash-back Visa, use their bill pay feature and debit card that reimburses ATM fees worldwide). Of considerable importance to us is that Fido is the ONLY one of the big three brokerages that offers an account lock-down feature to combat ACATS fraud. There are numerous threads on this well-documented threat on Bogleheads, etc.

We keep a meaningful amount at Schwab too, which gets us a second ATM fee-free debit card, easier-than-Fido bill pay and a second option in case our Fidelity account is temporarily locked down.

The icing on the cake is holding almost entirely Vanguard ETFs in these accounts (thereby taking advantage of the one and only thing Vanguard does well). YMMV

 

[big-papa]

It took a while to get there, but yes, with the exception of our checking/savings at our local credit union and our I-bonds at TreasuryDirect, everything is at Fidelity. Over the years, we also had taxable accounts at Vanguard and at Schwab. I also had E-trade for the purposes of RSU's and ESPP when I was still working. At one time an employer of mine also had a deferred compensation plan held at yet another broker. And I've had 401Ks at Vanguard in the past.

Upon leaving an employer, I always rolled my 401K over to Fidelity.
I ultimately decided there was no immediate value in keeping a Vanguard account open, so we closed it.
Schwab was the first brokerage house I was at back when I owned individual stocks. Closed it a long time ago.
When I left my employer with the deferred compensation plan, it started payout mode. In year 9, they moved it from the prior brokerage to Fidelity and it finished payout years ago.
When I left an employer that had RSUs/ESPP, I closed the E-trade account, but ended up opening another when I was at my next employer - I always sold company shares as soon as they vested and transferred proceeds to my taxable account at Fidelity. So other than RSU/ESPP transactions, I had no reason to keep an account there.

Today at Fidelity, we have a couple of joint taxable accounts, I have 2 TIRAs and 1 Roth, DW has 1 TIRA and 1 Roth. We also have the Fidelity branded credit card. Customer service has always been superb.

Now, Fidelity probably doesn't like us all that much - with the exception of the core/settlement accounts (in which we keep very little $), nothing we hold is a Fidelity provided investment.

I do understand when people hold a separate account at another brokerage as a hedge against IT issues at their primary brokerage. Nothing wrong with it, it's just not what we chose to do.

Cheers.

 

[deserat]

'So I am safe with Fidelity for life?'

That is unanswerable-you must decide if that is a risk you wish to take. People here have different perspectives. Moreover, your lifespan is unknowable.

Is there a risk of VG, Fidelity or Schwab going under? Yes, but it is highly improbable.

If you go to Bogleheads, you will see this question discussed ad infinitum. Fidelity does have some services that VG doesn't and vice versa.

I personally had rolled over an employer plan to an IRA at Fidelity after helping my now departed father roll his IRA and other after tax investments to Fidelity. We had an uncomfortable experience with that which made us both have a bad taste in our mouths about Fidelity, however, when he passed, the funds transfer process was very straightforward for his widow.

Most of my portfolio was at Vanguard so I decided to move a significant portion of my rolled over IRA at Fidelity to Vanguard as I wished to simplify future Roth IRA conversions. I left a small amount at Fidelity for possible future LTC costs. I do have the Fidelity credit card and cash account (can't remember their product name). I find I rarely use it.

For my day to day expenses, I have two credit union accounts that I have used for years. They meet my needs, especially since I lived and now travel overseas a lot.

So, I do not espouse Fidelity for life. However, I can see how some may prefer it.

 

[MRG]

The icing on the cake is holding almost entirely Vanguard ETFs in these accounts (thereby taking advantage of the one and only thing Vanguard does well). YMMV

Vanguard is NOT a technology company. One of the most ignorant things they did was to build some of their own technology.