Yes, Fidelity does retirement planning. Fidelity Investments runs one of the largest retirement planning ecosystems in the United States, managing more than 53 million retirement accounts across IRAs, 401(k)s, and 403(b)s. The Employee Retirement Income Security Act of 1974 (ERISA) requires any entity that administers employer-sponsored retirement plans to follow strict fiduciary rules—and Fidelity is one of the largest plan administrators bound by those rules.
About 56% of American workers feel behind on their retirement savings, according to the National Institute on Retirement Security. Fidelity addresses this problem by offering free planning tools alongside paid advisory services—from a $0 robo-advisor to a dedicated wealth management team for high-net-worth clients.
- 📌 How Fidelity’s retirement planning tiers work and which one fits your situation
- 💰 The exact fees, minimums, and services at each level of Fidelity’s advisory ladder
- ⚖️ What federal laws like ERISA and Regulation Best Interest mean for your Fidelity retirement account
- 🔄 How to roll over a 401(k) into a Fidelity IRA without triggering taxes or penalties
- ❌ The biggest mistakes people make when using Fidelity for retirement planning—and how to avoid them
What “Retirement Planning” Means at Fidelity
Fidelity Investments is not just a brokerage firm. It functions as a retirement planning platform that covers everything from workplace 401(k) administration to one-on-one wealth management for retirees. The company operates through multiple entities—Strategic Advisers LLC acts as the registered investment adviser, while Fidelity Brokerage Services LLC handles brokerage transactions.
This dual structure matters because it determines what kind of duty Fidelity owes you. When Fidelity acts as a registered investment adviser through Strategic Advisers LLC, it owes you a fiduciary duty under the Investment Advisers Act of 1940. When it acts as a broker-dealer, it must follow the SEC’s Regulation Best Interest, which requires recommendations to be in your best interest but does not impose the same continuous fiduciary obligation.
Fidelity’s retirement planning services cover three core areas: self-directed planning tools, robo-advisory management, and human-advisor-led wealth management. Each tier has different fees, investment minimums, and levels of personal attention.
The Federal Rules That Govern Your Fidelity Retirement Account
ERISA and Employer-Sponsored Plans
The Employee Retirement Income Security Act (ERISA) of 1974 is the federal law that controls employer-sponsored retirement plans like 401(k)s and 403(b)s. ERISA requires plan fiduciaries to act solely in the interest of plan participants and beneficiaries. Fidelity, when it administers your workplace retirement plan, cannot make decisions that benefit itself at your expense.
ERISA fiduciaries must follow four core principles: the exclusive benefit rule, the prudent expert rule, the diversification requirement, and the plan document rule. If Fidelity violates any of these, plan participants can file complaints with the DOL or pursue legal action to recover losses.
The practical consequence is that Fidelity must offer a diversified menu of investment options in your workplace plan. It cannot load up your 401(k) with only high-fee Fidelity funds. The Department of Labor’s fiduciary rule also requires that anyone providing advice to retirement investors must act as a fiduciary if the advice reflects professional judgment about your individual circumstances.
Regulation Best Interest for Brokerage Accounts
When you open a standard brokerage IRA at Fidelity (not a managed account), Fidelity acts as a broker-dealer. The SEC’s Regulation Best Interest (Reg BI) applies here. Reg BI requires Fidelity to recommend investments that are in your best interest at the time of the recommendation—but it does not require ongoing monitoring of your portfolio.
This distinction has a real consequence. If you use a self-directed Fidelity IRA, the firm is not checking whether your asset allocation still makes sense five years from now. You are responsible for that. If you want continuous fiduciary oversight, you need to step up to one of Fidelity’s managed account services.
The Investment Advisers Act of 1940
Fidelity’s advisory services—Fidelity Go, Fidelity Advisory Services, Fidelity Wealth Management, and Fidelity Private Wealth Management—are all offered through Strategic Advisers LLC, a registered investment adviser. Under the Investment Advisers Act of 1940, Strategic Advisers owes you a continuous fiduciary duty. This is a higher standard than Reg BI.
A continuous fiduciary duty means Fidelity must monitor your investments on an ongoing basis, disclose all material conflicts of interest, and put your financial interests ahead of its own—not just at the point of recommendation, but at all times. Choosing a managed account at Fidelity gives you stronger legal protections than a self-directed brokerage account.
Fidelity’s Retirement Account Options
Fidelity offers several retirement account types with no account fees or minimums to open. Each account has different tax treatment, contribution limits, and withdrawal rules.
| Account Type | Key Tax Benefit |
|---|---|
| Traditional IRA | Contributions may be tax-deductible; earnings grow tax-deferred |
| Roth IRA | Contributions are after-tax; qualified withdrawals are tax-free |
| Rollover IRA | Accepts funds from old 401(k)s without taxes or penalties |
| SEP IRA | Allows self-employed individuals to contribute up to 25% of compensation |
| Solo 401(k) | Designed for self-employed workers with no employees besides a spouse |
A Traditional IRA works best for people who expect to be in a lower tax bracket in retirement because they get a tax break now and pay taxes later. A Roth IRA is the opposite—it works best for people who expect to be in a higher tax bracket in retirement because qualified withdrawals are completely tax-free.
The Rollover IRA is one of Fidelity’s most-used products. When you leave a job, you can move your old 401(k) into a Fidelity Rollover IRA through a direct trustee-to-trustee transfer. This avoids the 20% mandatory withholding that applies to indirect rollovers and keeps the transaction tax-free.
Fidelity’s Five-Tier Advisory Ladder
Fidelity structures its advisory services in five tiers, each with different minimums, fees, and levels of human involvement.
Tier 1: Free Self-Directed Planning Tools
Fidelity’s Planning & Guidance Center is available to all account holders at no cost. It includes a retirement score estimator, a retirement income calculator, an income annuity explorer, and scenario modeling tools. You can create and track multiple financial goals, test different saving strategies, and see how changes to your contributions affect your projected retirement income.
The free tools use algorithms to estimate your retirement readiness based on your current savings, contribution rate, expected Social Security benefits, and investment allocation. Fidelity’s Retirement Planner Suite now includes over 100 life-path simulations that model scenarios like market crashes, prolonged inflation, and early retirement.
The limitation of this tier is that you make all the decisions. Fidelity provides the data, but you must decide how to act on it. There is no fiduciary duty at this level because you are not receiving personalized investment advice.
Tier 2: Fidelity Go (The Robo-Advisor)
Fidelity Go is Fidelity’s automated investment management service. It builds and manages a diversified portfolio based on your age, risk tolerance, and financial goals. There is no minimum to open an account, and Fidelity charges no advisory fee for balances under $25,000.
Once your balance reaches $25,000, the annual fee is 0.35% of assets under management. This fee includes portfolio management, automatic rebalancing, and access to financial coaching sessions. For taxable accounts above $25,000, Fidelity Go also provides tax-loss harvesting—a strategy that sells losing investments to offset capital gains taxes.
Fidelity Go is offered through Strategic Advisers LLC, which means it carries a fiduciary duty. The day-to-day investment decisions are handled by a team of human professionals, not purely by algorithm. This makes Fidelity Go a hybrid robo-advisor, which sets it apart from fully automated competitors.
Tier 3: Fidelity Personalized Planning & Advice
This tier is designed for investors who want both digital management and access to human financial advisors. The minimum investment is $25,000, and the annual advisory fee is 0.50%. You get digitally led financial planning, automated portfolio management, and one-on-one calls with Fidelity advisors.
This is the first tier where you can get personalized retirement income planning. An advisor can help you with Social Security timing strategies, Roth conversion analysis, and tax-efficient withdrawal sequencing. The advice is nondiscretionary at the planning level, meaning Fidelity recommends actions, but you decide whether to implement them.
Tier 4: Fidelity Wealth Management
Fidelity Wealth Management is for investors with at least $500,000 in eligible Fidelity accounts. The annual advisory fee ranges from 0.50% to 1.50% depending on account size and service features. You get a dedicated Fidelity advisor who builds a customized financial plan covering your full financial picture.
Your dedicated advisor coordinates investment management, retirement income planning, tax optimization, estate planning strategies, and insurance needs. The advisor has support from a team of specialists in areas like tax law and charitable giving. This tier provides both nondiscretionary financial planning and discretionary investment management, meaning your advisor manages your portfolio day-to-day without needing your approval for each trade.
Tier 5: Fidelity Private Wealth Management
This is Fidelity’s top tier, available to clients with at least $2 million managed through Fidelity and $10 million or more in total investable assets. The advisory fee ranges from 0.20% to 1.04% per year. You get an entire advisor-led team dedicated to your financial life.
The Private Wealth Management team coordinates with your outside professionals—accountants, estate attorneys, and insurance advisors—to build a unified strategy. This tier covers advanced estate planning, philanthropic planning, business succession, and multi-generational wealth transfer. It is the closest thing Fidelity offers to a private family office.
How Fidelity Stacks Up Against Vanguard and Schwab
| Feature | Fidelity | Vanguard | Schwab |
|---|---|---|---|
| Robo-Advisor Fee | 0.35% (free under $25K) | 0.20%–0.25% | 0% (Intelligent Portfolios) |
| Robo Minimum | $0 | $3,000 | $5,000 |
| Human Advisor Minimum | $50,000 | $50,000 | $25,000 |
| Human Advisor Fee | 0.50%–1.50% | 0.30% | 0.80%–0.90% |
| Zero-Fee Index Funds | Yes (Fidelity ZERO) | No (but very low cost) | No |
| Branch Locations | 200+ | 0 | 300+ |
Fidelity stands out for its zero minimum on Fidelity Go and its Fidelity ZERO index funds with 0% expense ratios. Vanguard wins on advisory fees for larger accounts—a dedicated CFP at Vanguard costs only 0.30% for accounts over $500K. Schwab’s Intelligent Portfolios robo-advisor charges no advisory fee at all, though it requires a $5,000 minimum and holds a larger cash allocation.
For investors with under $25,000, Fidelity is the clear winner because Fidelity Go charges nothing while both Vanguard and Schwab require higher minimums. For investors with over $500,000 who want the lowest advisory fee with a dedicated human advisor, Vanguard offers the best value at 0.30%.
Scenario 1: The New Saver Starting From Zero
Meet Alex, age 28. Alex just got a new job that offers a Fidelity-administered 401(k). Alex has never invested before and has no idea how much to save or where to put the money. Alex’s employer offers a 50% match on the first 6% of salary. Alex earns $55,000 per year.
Under ERISA, Fidelity must provide Alex with a Summary Plan Description that explains the plan’s features, benefits, and investment options.
| Decision Alex Makes | Financial Outcome |
|---|---|
| Contributes 6% ($3,300/year) to get the full employer match | Receives $1,650 in free employer money every year |
| Ignores the 401(k) and contributes 0% | Loses $1,650/year in employer match—money left on the table |
| Chooses a Fidelity Freedom Target Date 2060 Fund | Gets an age-appropriate stock/bond mix that auto-adjusts over time |
| Picks only a money market fund inside the 401(k) | Earns low returns that may not keep pace with inflation over 35 years |
| Opens a Fidelity Roth IRA alongside the 401(k) | Gets tax-free growth on additional savings beyond the employer plan |
| Does nothing beyond the 401(k) | Misses the chance to diversify tax treatment in retirement |
Alex’s best move is to contribute at least 6% to the 401(k) to capture the full match, then open a Fidelity Roth IRA to save additional money in a tax-free account. Using Fidelity’s free Planning & Guidance Center, Alex can see how increasing contributions by just 1% per year could add hundreds of thousands of dollars by retirement.
Scenario 2: The Mid-Career 401(k) Rollover
Meet Dana, age 45. Dana left a previous employer and has $120,000 sitting in an old 401(k) administered by another company. Dana’s new employer also uses Fidelity. Dana wants to consolidate everything in one place.
Dana has three options: leave the money in the old plan, roll it into the new employer’s 401(k), or roll it into a Fidelity Rollover IRA.
| Rollover Choice | What Happens |
|---|---|
| Direct rollover to Fidelity IRA | No taxes, no penalties; Dana gains full control over investment choices |
| Indirect rollover (check mailed to Dana) | Old plan withholds 20% for taxes; Dana must deposit the full amount within 60 days or face taxes and a potential 10% early withdrawal penalty |
| Leave money in old 401(k) | No immediate tax impact, but Dana has limited investment options and may forget about the account |
| Roll into new employer’s 401(k) | Simplifies tracking, but investment options are limited to what the new plan offers |
The safest move is a direct rollover (also called a trustee-to-trustee transfer). Dana logs into NetBenefits.com, clicks “Rollovers” under the old plan, selects “Out of my retirement plan,” and completes the process. The money moves directly into a Fidelity Rollover IRA without triggering any tax withholding.
If Dana’s old 401(k) has both pre-tax and Roth contributions, each type must go into the correct account. Pre-tax money rolls into a Traditional or Rollover IRA. Roth contributions roll into a Roth IRA separately. Mixing them up could trigger an unwanted taxable conversion.
Scenario 3: The Pre-Retiree Planning for Income
Meet Gloria, age 62. Gloria has $640,000 across a Fidelity 401(k) and a Traditional IRA. She plans to retire at 65 and wants to know if her savings will last 30 years.
Gloria uses Fidelity’s retirement income calculator to estimate her monthly income from Social Security, her 401(k) withdrawals, and a potential income annuity. She discovers that delaying Social Security from age 62 to age 67 increases her monthly benefit by roughly 30%.
| Retirement Income Decision | Impact on Gloria’s Plan |
|---|---|
| Claims Social Security at 62 | Receives a permanently reduced monthly benefit |
| Delays Social Security to 67 (full retirement age) | Gets her full benefit—roughly 30% more per month than at 62 |
| Uses the 4% withdrawal rule on $640,000 | Can withdraw about $25,600 per year from savings |
| Withdraws 6% annually without adjusting | Risks running out of money before age 90 |
| Converts some Traditional IRA to Roth before age 73 | Reduces future Required Minimum Distribution (RMD) amounts and tax burden |
| Ignores RMDs after age 73 | Faces a 25% penalty on the amount not withdrawn (reduced from 50% under the SECURE 2.0 Act) |
Gloria decides to sign up for Fidelity Personalized Planning & Advice at 0.50% per year. An advisor helps her create a Roth conversion ladder—converting a portion of her Traditional IRA to a Roth each year before RMDs begin at 73. This strategy lowers her future tax bill and gives her more control over retirement income.
The NetBenefits Platform: Your Workplace Retirement Hub
If your employer uses Fidelity for its retirement plan, you interact with Fidelity NetBenefits. This is a separate platform from Fidelity.com designed for workplace retirement accounts.
NetBenefits lets you change your contribution rate, choose your investments, view your employer match, check your vesting schedule, and initiate rollovers. It also houses your Summary Plan Description (SPD)—the legal document that explains every detail of your employer’s retirement plan. Your SPD tells you the vesting schedule, loan provisions, hardship withdrawal rules, and whether the plan accepts rollovers.
One common source of confusion is that NetBenefits and Fidelity.com are separate logins with separate accounts. Your workplace 401(k) on NetBenefits does not automatically appear on your personal Fidelity.com dashboard unless you link them. Many investors do not realize this and end up losing track of old workplace accounts.
Mistakes to Avoid When Using Fidelity for Retirement
Not Taking the Full Employer Match
This is the most expensive mistake you can make. If your employer matches 50% of your contributions up to 6% of salary, and you only contribute 3%, you are leaving free money behind. On a $60,000 salary, that is $900 per year in lost employer contributions—money that could grow to tens of thousands of dollars over a career.
Doing an Indirect Rollover Instead of Direct
If you request an indirect rollover from your old 401(k), the plan administrator is required to withhold 20% for federal taxes. You must replace that 20% out of pocket and deposit the entire original balance into the new account within 60 days. Failure to do this means the IRS treats the shortfall as a taxable distribution—and if you are under 59½, you also owe a 10% early withdrawal penalty.
Ignoring Required Minimum Distributions
Once you turn 73, the IRS requires you to withdraw a minimum amount from your Traditional IRA and 401(k) each year. Under the SECURE 2.0 Act, the penalty for missing an RMD dropped from 50% to 25% of the amount you should have withdrawn (and down to 10% if corrected within two years). Fidelity sends RMD reminders, but you are responsible for making sure the withdrawal happens.
Keeping Too Much Cash in a Sweep Account
When you deposit money into a Fidelity account, it automatically goes into a core position (usually a money market fund). Many investors leave large sums sitting there instead of investing it. Over a 30-year period, the difference between earning 4% in a money market fund versus 8% in a diversified stock portfolio on a $100,000 balance is enormous—potentially over $600,000 in lost growth.
Related reading
- Who is Really the Trustee of a 401(k)? – Avoid This Mistake + FAQs
- Can Fidelity Manage My 401k? (w/Examples) + FAQs
- Can Edward Jones Manage My 401k? (w/Examples) + FAQs
- Are Vanguard Retirement Funds Good? (w/Examples) + FAQs
- Does ERISA Cover 401(k) Plans? (w/Examples) + FAQs
- Can AI Help With Retirement Planning? (w/Examples) + FAQs
- Are 401(k) Plans Tax-Deferred? – Avoid This Mistake + FAQs