Friday, December 02, 2005

Lowering My Fidelity Commission Level

Fidelity offers three commission levels depending on how many trades you do per year and/or the total across all your Fidelity accounts. The default rate that everyone qualifies for is "Bronze" which costs $19.95 per trade. Ouch.

Since my retirement funds are now spread roughly evenly between my Fidelity (a rollover IRA), my Calvert account (another rollover IRA) and my current 401(k) I do not qualify for the "Silver" level which would only cost me $10.95 per trade. I would need $50,000 in household assets for my purposes (since I don't do at least 36 trades a year) in order to qualify for the lower commission and I have roughly half of that at Fidelity. The key word is household.

Fidelity allows you to consolidate accounts that are held within a household (which seems to mean "single address" to them) regardless of relationship between people. I think this is their way of reducing mailing (and printing?) costs, but they offer a nice carrot. Control over the accounts is not affected in any way and you just fill out a simple form declaring the household relationship and mail it in.

I just finished filling this out for LaLa and I -- so even though we are not married, by combining our Fidelity accounts into a "household relationship" we will soon qualify for the silver commission level, hopefully just in time to start next year's project: Investing!


  1. I have asked Fidelity about joining our accounts, but they have always said that no, that they would have to have been joined when opened. Maybe I wasn't asking the right question, I just want to not have to log into two accounts!

  2. A household relationship is different though... our accounts are not joined (think about it, they can't just allow one person access to another's accounts without power of attorney or it being a joint account...) -- but, like you, I still log into her account because I know her password etc.

    I will post more about the household relationship as I learn more, but it's my understanding that they will stuff all our statements and prospectuses into one envelope and give us the benefit of allowing our totals to qualify us for lower commissions.

    If it gives us more than that, I'll definitely post about it

  3. That seems odd that Fidelity won't let people combine accounts but will mail statements together to a "household"... but hey, if it works, use it! It's always nice when companies recognize the various kinds of situations that can constitute a household, even if it takes saving themselves some postage to make them do it! Now let's see, how much money would it save the US government if same-sex couples could file taxes jointly, get married, etc...!

  4. it doesnt seem that odd to me...seeing information (like viewing statements etc) is quite different from having power to do things with that account (like moving money around, withdrawing etc).

    But I'm happy that something so benign (and quick) allows us to get better fidelity benefits that's for sure!


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