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Fidelity Investment Account

By: Alex Busson | Updated: 29th July 2020.

Great for: Great for novice investors
3.5 stars question mark
Fidelity logo

Fidelity’s fees are a little steep compared to other options. However, if you’re new to investing, you may find that it’s worth paying extra for its tools and expertise. Fidelity makes it easy to find investments and funds to match your specific needs. You don’t need a deep understanding of the markets to make informed decisions with your savings.

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WHAT YOU NEED TO KNOW

  • You can search for new investments based on a set of preferences – like dividend yield. This is a huge help for novice investors.
  • Busy investors may benefit from Fidelity’s managed funds
  • Fees should be an important consideration if you’re opening a small account.
  • *Platform fee 0.20-0.35% of your account balance per year
  • **Sharedealing charge £10 online, £30 over the phone.

DISCLAIMER

The value of your investments can go down as well as up and you may not get back all the money you put in. All investments carry a varying degree of risk and it’s important you understand the nature of these risks.

what we like

  • Easy search tools help you target the right investments.
  • Wide range of funds available to suit your risk tolerance.
  • Call centres based in the UK and Ireland.
  • PLATFORM FEE:

    £45*
  • Share dealing charge:

    £10**

WHAT YOU NEED TO KNOW

  • You can search for new investments based on a set of preferences – like dividend yield. This is a huge help for novice investors.
  • Busy investors may benefit from Fidelity’s managed funds
  • Fees should be an important consideration if you’re opening a small account.
  • *Platform fee 0.20-0.35% of your account balance per year
  • **Sharedealing charge £10 online, £30 over the phone.

DISCLAIMER

The value of your investments can go down as well as up and you may not get back all the money you put in. All investments carry a varying degree of risk and it’s important you understand the nature of these risks. Remember that taxes can be complicated and the tax benefits of this, or any, product depends on your personal circumstances. Tax rules are subject to change.

Our bottom line

Fidelity’s fees are a little steep compared to other options. However, if you’re new to investing, you may find that it’s worth paying extra for its tools and expertise. Fidelity makes it easy to find investments and funds to match your specific needs. You don’t need a deep understanding of the markets to make informed decisions with your savings.

Top feature of Fidelity’s Investment account

Fidelity’s ‘Pathfinder’ tool makes it easy to find an appropriate investment fund – even if you know nothing about the markets.

Simply select whether you want to invest for income or growth, then decide how much risk you’re willing to bear. Once you’ve done this, Fidelity gives you a list of suitable funds, making it easy to compare fees and performance.

Fidelity’s pooled funds are managed for you. All you have to do is monitor the performance and add new savings whenever you’re ready.

Why trust me


Alex Busson

I’ve been an investor for almost 10 years, and learned most lessons the hard way. You name the daft mistake and I’ll show you the negative returns on my statement. Today I’m a financial copywriter with a much better handle on things, and my expensive tuition has (finally) recouped those dreadful losses.

Fidelity’s commission prices

Fidelity charges £10 to place online stock trades, which is about average for the industry. However, trading over the phone costs £30. If your account is set up to reinvest dividends, these trades cost £1.50 each.

Fees you should know about

Fidelity charges a small annual fee – typically based on a percentage of your account balance:

  • On less than £7,500, you pay £45/year (or 0.35% with a regular savings plan).
  • On £7,500-£250,000, you pay 0.35% per year.
  • On £250,000-£1million, you pay 0.20% per year.

You always pay the lowest possible rate on your total balance. For example, if you have a £500,000 balance, you’d pay £1,000/year in fees (0.20% total). You would not pay 0.35% on the first £250,000, then 0.20% on the second.

You also don’t pay for any amount over £1million. If you have a high net worth, this may be an important benefit. No matter how much you invest, you can only pay up to £2,000 in fees.

Do remember, however, you also incur fees for holding ETFs and managed funds. For instance, Fidelity’s ‘Balanced Income’ fund has a 0.96% management fee. Suppose you invested £100,000 into this fund. You would pay £1,310 per year (0.35% for your account, plus 0.96% for the fund).

Although these percentages sound small, they shouldn’t be overlooked. If you’re investing for the long-term, even a small difference in fees can have a big impact on your compounded returns.

If you’re investing under £7,500, I’d suggest setting up the regular £50/month savings plan. This means you avoid the £45 flat fee.

Buying shares and ETFs with Fidelity

If you’re new to investing, placing your first trade can be stressful. You know what you want from an investment, but you don’t know which stocks and ETFs fit your needs. Fidelity’s tools help solve this problem.

You can search for stocks based on a set of preferences. For example, suppose you’re looking for a 4-6% dividend yield. You can select this as one of your options. Fidelity gives you a list of stocks which currently pay this amount.

You’re shown each company’s long-term and short-term performance, so you can see how they rank before you buy.

Fidelity is also connected to Morningstar (a respected rating-service for investment funds). You can search for ETFs based on their score.

Just be aware that the “best” investments may not be the best value. Stocks and funds with a strong track record are seldom overlooked by the markets. It’s why stocks like Amazon are so expensive.

Fidelity’s platform

You can place secure online trades from Fidelity’s website, or from your mobile device with a downloadable app. You can also buy and sell over the phone, although at £30 per trade, this is by no means cheap.

You’ll probably find the platform most useful if you’re unsure where to invest. Fidelity’s ‘Pathfinder’ tool is ideal for beginners. This helps you find appropriate funds based on your specific needs.

Simply choose how you wish to invest – for income or growth. Then decide how much risk you’re willing to accept. (Of course, high-risk investments could lose you more money, but often have the chance of much higher returns.)

Fidelity then gives you a list of suitable options. Once you’ve chosen a fund, and made a deposit, its expert analysts manage everything on your behalf.

Fidelity’s research offerings

Fidelity’s tools are most useful for comparing different investments. Once you’ve selected your preferences for a stock or ETF, you’re shown a list of suitable options. You can see how each company ranks in terms of performance and profitability.

Select up to seven companies to shortlist for closer comparison. Fidelity presents you with key ratios – like price-to-earnings and price-to-earnings growth.

You can also hit the ‘Chart Growth’ button to see what each stock would have returned you over a given period – from one day up to 10 years.

Service and support

Fidelity’s call centres are based in the UK and Ireland. What’s more, unlike with some rival companies, the phone number is clear and easy to find. If you’re choosing a brokerage for a large portion of your savings, the ability to call a Freephone local number makes a huge difference.

Of 1,167 Trustpilot reviews, Fidelity scores 4.1 stars, which is reasonably high compared to many of its peers.

Is Fidelity right for you?

Your biggest consideration with Fidelity will probably be the fees. This account is not your cheapest option by any stretch. However, if you’re a novice investor, or want others to do the hard work for you, these added costs may be worth your while.

If you’re investing less than £7,500, you should commit to the £50/month savings plan. Otherwise, you’d pay an annual £45 flat fee. Again, £45 may not sound like a lot, but on a £1,000 balance it would mean paying 4.5% in fees. That is, to my mind, far too expensive for a brokerage account.

High net-worth individuals may find the fees negligible, because you only pay the 0.20% fee up to £1million. No matter how much extra you invest, you cannot pay more than £2,000 per year in account fees.

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