Fidelity Cash Management Account vs. Schwab Investor Checking
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- Опубліковано 12 вер 2024
- NOTE: SPAXX will be available as a core position in Fidelity's Cash Management Account as of June 15, 2024. I will be switching over!
TL;DR; - Fidelity Cash Management Account is the winner in my book!
A viewer asked me to do a video on the Fidelity Cash Management Account vs. the Schwab Bank Investor Checking Account, so here we are! This video will compare the features between Fidelity's CMA and Schwab's Investor Checking as well as which one I would pick. I have both accounts but I definitely have a preference in 2024. Watch and see how they compare!
Fidelity Worldwide ATM withdrawal has no foreign transaction fee. Only when you use the debit card to pay goods and services outside the U.S.
@@sladesurfer They just removed FTF from their Visa debit cards as well:
www.fidelity.com/spend-save/help-center/debit-card/get-started?selectTab=1
@@phuocle ok cool thanks for the update. So basically, Charles Schwab and Fidelity is basically even now when it comes to travel ATM
@@sladesurfer On that metric, yes. And that just makes Fidelity that much better now in my opinion.
Awesome video, Fidelity seems like a no brainer here. Thank you!
Besides international settlements!
Yeah this was the last video I needed to decide, I’ll go Schwab. Thanks!
I'm glad it was helpful!
Fidelity - 1% foreign transaction fee is only when we use Debit card at shops / POS trans. I used both fidelity and schwab in Singapore, Hongkong and India and the forex was almost same. No 1% deduct there for sure.. though the reps told me they charge 1%. I dont think so. Great Video comparing both. Thank you!
I need to add a caption to the video… they just very recently did away with the 1% FTF.
I just returned from Japan and used my atm fidelity card there. While the atm machine fee was reimbursed, I noticed on my CMA statement that the exchange rate I ended up getting was not very good. Fidelity took out more money each time I withdrew from ATM in regard to the exchange rate that particular day. This tells me they charged for foreign fee. I wonder if the Schwab debit/ATM card gives you the closest to market exchange rate of the day when you withdraw on that particular day. I used local currency to avoid conversion fee.
appreciate your simple and honest review, no hype or cheerleading involved..
Opening first bank account - you've sold me on Fidelity with its all in one simplicity.
Glad to hear it! Good luck to you!
Please note that on or around June 15, 2024, you'll have the option to elect Fidelity(R) Government Money Market Fund (SPAXX) as your core sweep investment vehicle. You will not need to take any action if you wish to retain the Bank Sweep as your core position.
Yes! I just responded as such to another viewer! I’m going to have to add a caption or something to that effect.
Really like the Fidelity account. Schwab account can do Zelle, unfortunately it’s a no for Fidelity.
I don't use Zelle due to a lack of security and scams, so it's not an issue for me. But if you need Zelle, then that may be the deciding factor.
Thank You and Happy Easter !
The Fidelity CMA account is fantastic
Thank you so much for this review! Please continue to provide content such as this. Any suggestions on good dividend research websites????
One of my favorite tool is the Excel file here: moneyzine.com/investments/dividend-champions/
It gives you a bunch of metrics in dividend stocks as well as the current listing for Champions, Kings, and Aristocrats. Good luck!
Fidelity has no foreign transaction fee anymore
Yes - and it's nice! You also can opt to have SPAXX as a core position in your CMA account now... lots of changes so I may have to do an update!
Where did you get this info? I’m checking their site now and they say that a “foreign transaction fee of 1% may apply”.
@@MorchSevonth Hi, please see here:
www.fidelity.com/spend-save/help-center/debit-card/get-started?selectTab=1
@@phuocle Wow that's amazing! Thanks for sharing. Definitely opening account with them then.
Do you do tutoring for investing? I would like to study and learn more about how to do it, but I've had a difficult time trying to start.
Not really at the moment though I may in the future. If you have a specific question, you can always message me and perhaps I’ll address it in one of my videos.
I like my Fidelity cash account. But Schwab debit card looks so good!
@@jlee8792 In what way?
@phuocle haha maybe because its silver lol
@@jlee8792 I suppose that’s as good a reason as any!
Great video - appreciate the research & insight
Thank you
Do you know if there's an option of not wanting the ATM card issued for the Fidelity Cash Management Account if you don't want it? Thank you!
Not sure if you can just decline from the outset. What I do know is that if you don't use it and just keep it in a drawer, they'll send you a letter saying that they'll deactivate it. It happened for one of my planning accounts that I just plan to hold and not really transact in. I'd ask and just see if you can not get one from the get go if don't want it.
Schwab does have a sweep to TD Bank, paying .45%
Can you use margin in the Fidelity account to overdraw the cash balance if you hold equities to borrow against?
Yes you can. You'll have to select that option but it's available.
Schwab for me
That’s the great thing about having choices as they are personal!
I meant Fidelity...sorry!@@phuocle
How about transfer money from US to outside of US (e.g. Japan). Do you have any recommendation between these two accounts? How is the rate and fee structure?
When Schwab declared they were setting a percentage of minorities mandate for advisors, i went with another firm
BS , I’m not racist but ill be damned if i trust my money to anyone hired solely because of the color if their ski as opposed to their competence.
No actually yes you are racist
Do you use the Fidelity checks? The names on our checks have a very small font compared to other checks I have always had.
I do but it’s rare. Usually to pay the tree trimmer who doesn’t have Venmo or whatever. I don’t recall that the font on the name is particularly small; all I remember is that I checked it upon receipt to make sure it was correct and then didn’t really think about them again.
But now that I’m checking, they are a smaller font than what I have on my Schwab checks. However, as I rarely use checks, it’s more of a nice to have and really doesn’t bug me. Good luck!
@@phuocle Glad that you have the small font. Thought it was only on my checks, but I am like you, don't really write many checks. I have not made Fidelity or Schwab my main account yet. Now have my local credit union, but have thought about making my retirement and Social Security to start going into one of the checking and cancelling my checking with the local credit union.
I recently opened a Fidelity CMA. Does it make sense for me to transfer the investments from another existing Fidelity brokerage to this new one?
@@Westie5911 It’s not required at all but I am planning to do exactly that just to simplify my financial life.
Is the Fidelity 1% foreign transaction fee assessed on ATM withdrawals or credit/debit card purchases? Are foreign ATM fees reimbursed?
Good news - Fidelity has gotten rid of the foreign transaction fee, so this is moot! I'll need to add a note to that part of the video. 🙂
Hi,
I love the features of the Fidelity CMA but I don't like the idea of having my daily banking (direct deposit, bill pay, check writing, debit, etc) to mix with my company 401k with Fidelity. I prefer to never look at my 401k other than once a year rebalancing. I also am worried about endangering my 401k should my checking account get hacked.
So I am considering Schwab. I was thinking buying SWVXX (say $20k usd) in the linked Schwab Brokerage Account and use this Schwab Brokerage Account as the overdraft protection for the Schwab Investor Checking Account while holding very little money, say $1000 usd, in the Schwab Investor Checking Account. If I do this, and I used my Schwab Investor Checking debit card to pay for an item worth $2000 usd, or if I have automatic bill pay of $3000 usd, will the money in SWVXX not get liquidated automatically to cover the deficiency of the Schwab Investor Checking Account??
I will post the same question on your other video for greater visibility. TIA
Those are well founded concerns, so I understand where you're coming from. I'm comfortable that my accounts are sufficiently secured with various 2FA methods plus other protections like SIPC, that it's not something I worry about. For me, the simplicity of having things in one place outweighs any negative. I'm also at a stage in my life where seeing my 401K balance multiple times a day gives me joy rather than any concern as I edge closer to retirement and seeing how much I've accumulated gives me a lot of peace everything is going as it should.
To your specific question, the answer is "I don't know". I still have my Schwab Checking account but it only has $1 in it to keep it open. I may add more to make it a true back-up account just in case but it has been years since I've actually used it so I can't say how it would function. Having said that, I have heard that it's possible to do what you're saying: keep a small amount in the checking account itself but hold a lot more in the linked brokerage in a money market account that would then be liquidated to cover any spend a la an overdraft type facility. I just don't have any personal experience with that so I cannot say for sure. If you get confirmation, I'd appreciate it if you can let me know!
@@phuocle Sir, thank you for your prompt and thorough response. You unintentionally gave me a very important reminder in your response - turn on 2FA. As for Fidelity CMA vs Schwab investor checking, my analysis paralysis prevails. When I get an answer to my question about Scwab, I will share it here.
@@phuocle So I did speak to a Scwab Customer Service over the phone and what they told me is they will not automatically liquidate money market fund held inside the linked schwab one brokerage account to cover for the deficiency in the schwab investor checking account balance. You have to buy / sell manually which is quick but not as seamless as fidelity.
@@CNFat I was wondering the exact same question about using the overdraft feature from the brokerage. Did you ever find out?
@@arcee49 I ended up opening fidelity cash management account and loving it. i called schwab and the strategy i outlined in the comment you replied to won't work.