Fidelity Investment Rewards American Express Card Review

Overview

Fidelity Investment Rewards American ExpressThe Fidelity Investment Rewards American Express Card is currently one of the best points-productive cards in our round-up. The program is simple, earn 2% points on every purchase. The accrued points can then be exchanged for cash back.

Where it gets a little complicated is in the redemption. While having an eligible Fidelity account is not necessary for cash redemption, without one, your points can only be redeemed for Worldpoints Cash which has half the value.

Fortunately, there are quite a few eligible Fidelity accounts available for selection: an existing trading account, IRA, 529, or the Fidelity Cash Management Account. The Fidelity Cash Management account will probably be the favored choice for most people. There are no minimum balances, no monthly fees, no requirements for having a separate investment account, interest earning on your cash balance, debit card access where Fidelity reimburses all ATM and surcharge fees, and the list goes on-and-on. More details are available in their program details.

Pros

  • 2% points earning on everything.
  • No annual fee.

Cons

  • Must have an eligible Fidelity account for depositing the cash redeemed for points to fully realize 2% cash back, otherwise, it is only 1%.
  • Card acceptance. The American Express payment network has about half the card acceptance of cards from the Visa or MasterCard payment network.

Our Experience

Cash-back cards are very simple in their use and redemption. This one is no exception, except one detail in the points redemption which we discuss shortly.

2% on all purchases

All purchases accrue 2% points per each $1 spent. This is the single-most significant feature of this card. While other cards advertise 3%, 5%, or even 6% return on spending, these typically apply to a few specific categories, apply on a rotating basis, or are capped to some maximum. So for many users and in the long-term, 2% on everything will outpace cards that have higher returns but have limitations on applicability.

Pay heed in the redemption

In order to benefit fully from this rewards program, you must set up an eligible Fidelity account for depositing the cash redeemed from points. Otherwise, the exchange rate is 200 points/$1 (Worldpoints Cash) instead of 100 points/$1 (into eligible Fidelity account). There are also differences in minimums required for points-to-cash exchange. Worldpoints cash can be converted when your point balance reaches 2500 versus 5000 for Fidelity deposits. Finally, point redemptions into an eligible Fidelity account can be automated if you wish. Once the minimum points required for redemption is reached, the transfer can be automated at the end of each month. Now that’s convenience!

Access to the cash

As stated earlier, we think the Fidelity Cash Management account is the simplest vehicle for depositing your rewards cash. Access to your cash is equally easy. Link your Cash Management account to your checking account via routing number and account number; then transfer cash between the two accounts online using your Fidelity account. Alternatively, use the ATM/debit card that comes free with the account.

Who might benefit from this card

Everyone who has an eligible Fidelity account or has the willingness to open one can benefit from this card. Setting one up is simple and can all be done online. No annual fee and 2% cash back on everything; it’s simple and generous.

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