Invest Well

Investing is the cornerstone of the FI/RE approach. It can be a great way to make your money work harder to get you to your goals.

Fidelity offers personal investment accounts with no minimums, which means you can start investing today.

Savings vs. Investment over the past 30 years

No matter how you slice it, historical investment returns from the S&P 500 stocks* have beaten savings accounts** over the past thirty years.

With an initial sum of $10,000, keeping your funds in a CD would have netted you about $26,142, compared to investing in an S&P 500 Index fund, which would have resulted in over $166,334—a difference of $140,192!1

Historical growth of $10,000 over 30 years

*Historical S&P 500 Index Stock Market Returns (yearly average), 1989-2018

**Savings account interest rate data are not available in the 30-year time period, as the Federal Reserve Economic Data began collecting data in 2009. Instead, this chart uses 1989-2018 interest rate data for Certificate of Deposit (CD) accounts, which have higher interest rates than savings accounts.

Ready to invest? Fidelity can help!

Fidelity offers tax-advantaged retirement accounts and taxable brokerage accounts, as well as a variety of investment options including index mutual funds (like our Zero expense ratio funds, among others), that can often be part of an FI strategy.

The accounts and products referenced throughout this experience have been chosen in the spirit of the FI/RE movement given their low cost structure and have not been selected based on your personal situation. These may or may not be the right options for you, only you can decide that.

Accounts

A tax-advantaged individual retirement account

  • Accessible after age 59.5
  • Tax-advantaged

Why it’s important for Financial Independence

An IRA allows you to save for retirement with tax advantages and the ability to withdraw funds without penalties after the age of 59.5. The tax benefits allow your savings to potentially grow, or compound, more quickly than in a taxable account. You can contribute to an IRA in addition to your 401(k).

There are two types of IRAs — Traditional IRAs and Roth IRAs — each with different advantages.

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A full featured, low-cost brokerage account that can meet your needs as you grow as an investor

  • No fee
  • Accessible anytime

Why it’s important for Financial Independence

Fidelity's brokerage account offers a wide range of investment choices, including individual stocks, bonds, or mutual funds. The investments you make in a brokerage account are available for withdrawal anytime.

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An account managed by a robo advisor—an easy, affordable way to enjoy the benefits of professional money management

  • Small fee
  • Accessible anytime

Why it’s important for Financial Independence

Fidelity Go® (FGO) is our lowest cost managed account program. Our investing pros manage your account for you, for a fee, based on your account's balance. The non-retirement investments you make in a FidelityGo account can be withdrawn without penalty at any time, but should be considered a long-term investment that won't be withdrawn for at least three years.

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Funds

Index funds with 0% expense ratio and no minimums, that can go into a brokerage or retirement account

  • Small fee

Why it’s important for Financial Independence

Many in the FI/RE movement look for the lowest cost investment funds. These are zero expense ratio funds that are designed to track an index that represents a segment of the market. If you’ve researched FI/RE and heard about Vanguard’s VTSAX, the Fidelity Zero funds are Fidelity’s comparable index mutual funds offered at an even lower cost than many of Vanguard’s Index Funds.

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"Investing is the only way to really achieve FI/RE"

— Minah

There's no match for Fidelity in index investing – not even Vanguard.

Fidelity stock and bond index mutual funds and sector ETFs have lower expenses than all comparable funds at Vanguard.* Learn more about Zero funds

*Fidelity beats Vanguard on expenses on 24 of 24 comparable stock and bond index funds, across all Vanguard share classes with a minimum investment of less than $3 billion. Total expense ratios as of January 7, 2020. Please consider other important factors including that each fund’s investment objectives, strategy, and index tracked to achieve its goals may differ, as well as each fund’s features and risks.

  1. Assumes a one-time deposit of $ 10,000 for both account types. Here are some assumptions we are making: 1) No withdrawals are made from the account during the goal timeframe. 2) No fees or taxes are applied. 3) For investing returns, the returns of the Standard & Poor's 500® Index were used. Any chart is for illustrative purposes only and does not represent actual or implied performance of any investment option. Stocks are represented by S&P 500 from 1989-2018. Standard & Poor's 500® Index (S&P 500® Index). The S&P 500 Index is a market capitalization-weighted index of 500 common stocks chosen for market size, liquidity, and industry group representation to represent U.S. equity performance. 4) Savings account interest rate data are not available in the 30-year time period, as the Federal Reserve Economic Data began collecting data in 2009. Instead, this chart uses 1989-2018 average interest rate data for Certificate of Deposit (CD) accounts as sourced by Federal Reserve Bank of St. Louis, which historically have higher interest rates than savings accounts.

This experience is educational in nature and should not be viewed as a recommendation from Fidelity to take any action. In the spirit of the FIRE movement which is places a premium on expenses, information provided has been selected solely on this factor rather than your personal situation. Please use this experience as a starting point to learn more about the different products and/or services Fidelity makes available. Fidelity does not provide legal or tax advice. Tax laws and regulations are complex and subject to change, which can materially impact investment results. Fidelity makes no warranties with regard to such information or results obtained by its use, and disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information.

Zero account minimums apply to retail brokerage accounts only. Account minimums may apply to certain account types (e.g., managed accounts).

Investing involves risk, including risk of loss.

Fidelity Go® provides discretionary investment management for a fee. Advisory services offered by Fidelity Personal and Workplace Advisors LLC (FPWA), a registered investment adviser. Brokerage services provided by Fidelity Brokerage Services LLC (FBS), and custodial and related services provided by National Financial Services LLC (NFS), each a member NYSE and SIPC. FPWA, FBS and NFS are Fidelity Investments companies.

Please click here to learn more about the Invest Well logic.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.

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