Fidelity Rewards Visa Signature Review

Full Review of Fidelity Rewards Visa Signature

Pros Explained

• Earn Unlimited 2% in Cash Back: While this is ostensibly a cash-back card, you actually earn 2 rewards points per dollar on purchases, with those points redeemable at 1 cent apiece. Provided you redeem the points into a qualifying Fidelity account, this arrangement essentially gives you 2% in cash back. This rate is one of the best cash-back rates on all purchases available with a no-annual-fee credit card.
• Rewards Can Be Automatically Redeemed: You can set up automatic redemption for your rewards into your qualifying Fidelity account. That way, your rewards don’t sit idle and you avoid missed investment income by forgetting to redeem them.

Cons Explained

• No Bonus: While many cash back credit cards, even those that lack an annual fee, come with one-time offers, this card does not. While the high 2% cash back rate on purchases does help make up for this, you might earn more in the first year with a card that offers a bonus, since these can easily run to $150 or even $200.
• The Best Rewards Require A Fidelity Investment Account: Most cash-back credit cards with similar rewards earning rates offer a range of redemption options, including statement credits and checks, with minimal variation in their benefit or conditions. With this card, by contrast, you only get the advertised 2% cash-back rate if you're a Fidelity customer. Fidelity will open an account for those without one at the time of card application but it does require applying for the card over the phone rather than online.
• Redeeming Rewards Comes With Drawbacks: To redeem rewards into a qualifying Fidelity account requires accepting a related limitation and potential complication. The limitation is that you can't redeem your rewards into an eligible Fidelity account until your balance reaches 2,500 points, a total you won’t reach until you’ve spent $1,250 on the card. The possible complication is if you choose to redeem your rewards into a Fidelity retirement account. If you do so, and also have a similar retirement account at another institution to which you’re also contributing, you might too easily exceed the total contribution limit for a year. That’s a costly mistake that could trigger financial penalties.

The Fidelity Rewards Visa Signature credit card is for people with excellent credit who want to earn cash back that allows them to invest for their future. And invest with Fidelity, specifically. While you can get the card without having a Fidelity account, there’s little reason to do so unless you’re willing to go through the process of opening an account and being a Fidelity customer. Since an account is required to earn the card's unlimited 2% cash back on all purchases it makes most sense for existing customers but the rich rewards can be a strong incentive to become one.

Rewards Earning Details

While this card is marketed as offering 2% in cash back, you actually earn 2 rewards points per dollar on net purchases. You can earn unlimited points and your points never expire as long as your account remains open and in good standing.

Rewards Redemption Details

You can redeem the rewards points you earn for cash back, travel, merchandise, gift cards or a statement credit. Unfortunately, the only option that guarantees the advertised 2% cash back rate is depositing your rewards into an eligible Fidelity account as cash back. Eligible Fidelity accounts include:

• Most non-retirement accounts
• Traditional IRAs
• Roth IRAs
• Rollover IRAs
• SEP IRAs
• Fidelity Charitable Giving Accounts
• Fidelity HSAs
• Fidelity-managed 529 College Savings Plan accounts

You have two options for redeeming rewards into an eligible Fidelity account. You can set up automatic redemption or use the on-demand redemption option. 

Automatic redemption can be set up by adding your eligible Fidelity account to receive cash deposits or by calling 888-551-5144. After automatic redemption is set up, your points balance will be checked at the end of each month. If the points balance exceeds 2,500 points, the minimum redemption level, your rewards points will be converted to cash back and automatically deposited. Otherwise, they'll continue to accrue until you reach the 2,500-point balance. 

On-demand redemption is your other option. This allows your account to accrue points until you decide to manually redeem them. You still must have at least 2,500 points to redeem them into an eligible Fidelity account. Redeeming your rewards for any option other than a deposit to a qualifying Fidelity account does not guarantee a rate equivalent to 2% cash back per dollar of net purchases.

How to Maximize Your Rewards

To maximize your rewards with this card, you only have to do two things. First, put all eligible purchases on your credit card to earn the most rewards points possible. Next, make sure you redeem your rewards into an eligible Fidelity account to get the most value, a penny per point, out of your rewards. 

Fidelity Rewards Visa Signature's Outstanding Benefits

• Lost luggage reimbursement: Up to $3,000 of supplemental reimbursement coverage for checked luggage or carry-on baggage that is lost due to theft or misdirection by the common carrier with certain exceptions.

Standard Benefits

• Auto rental collision damage waiver supplemental to other insurance
• Best available rate guarantee and certain discounts for Visa Signature Luxury Hotel Collection
• Concierge for booking event tickets, travel and other services
• Extended warranty
• Purchase security insurance for stolen or damaged purchases
• Roadside dispatch
• Travel and emergency assistance services

Cardholder Experience

This card is issued by Elan Financial Services, which was not ranked in J.D Power's 2020 U.S. Credit Card Satisfaction Study. As a cardholder, you can contact Elan Financial Services' customer service department 24/7 by calling 888-551-5144. You can also manage your card on the Fidelity mobile app for Android phones and iPhones.

Security Features

This card offers standard security features such as zero fraud liability and digital wallet support but does not provide any security features that differentiate it from other cards. 

Fees to Watch Out For

The Fidelity Rewards Visa Signature card's fees are in line with most cash back credit cards. Carefully consider the balance transfer fee of $5 or 3% of the amount of the balance transfer, whichever is greater, as it is possible to find cards that have an introductory period with no balance transfer fees. Watch out for the 1% foreign transaction fee, as well. While this fee is relatively low, many cards don’t charge a foreign transaction fee at all.

Our Verdict

The Fidelity Rewards Visa Signature credit card might best be considered a supplement to a Fidelity investment account, one that provides a simple way to regularly top up your investments with a stream of credit-card rewards. While being a Fidelity customer isn’t required to apply for the card, an account must be set up on the phone prior to being able to get the card and begin earning. So, everything about Fidelity Rewards Visa Signature is favorable to Fidelity customers, and of little appeal to those who aren’t, unless you’re willing to become one.

But the card isn't ideal for every Fidelity customer. If you'd rather not mix together rewards and investments, which can create some complications, and want to earn the absolute maximum rewards on your spending, you’ll likely be better off with other credit cards that offer exceptional rewards in the categories in which you spend the most. For foodies or simply those in a big household, one example is the American Express Blue Cash Preferred credit card, which offers 6% cash back on grocery store purchases at U.S. Supermarkets of up to $6,000 per year, 6% back on select streaming services, 3% back on gas at U.S. gas stations and transit expenses, and 1% on all other spending (though with a $95 annual fee). Other cards may also offer more premium ancillary benefits that could be useful when traveling or making larger purchases.