Fidelity has no traditional savings account. Instead, cash in Fidelity accounts earns interest through either the FDIC-insured program bank sweep (~2.72% APY) or Fidelity money market funds — primarily SPAXX at ~4.97% yield. Most customers earn far more by switching to SPAXX.
Bottom line: Switch your Fidelity core position to SPAXX for ~4.97% yield. The default FDIC sweep earns only ~2.72%.
Fidelity Cash Options Compared
| Option | Rate / Yield | FDIC Insured | Notes |
|---|---|---|---|
| FDIC-sweep (default) | ~2.72% APY | Yes (up to $5M) | Auto across 20+ program banks |
| SPAXX (Government MMF) | ~4.97% yield | No (SIPC) | US gov securities; very low risk |
| FDRXX (Government Cash Reserves) | ~4.95% yield | No (SIPC) | Alternative to SPAXX |
| FDLXX (Treasury-Only MMF) | ~4.90% yield | No (SIPC) | Treasury bills only |
What 4.97% Yield Means in Practice
| Balance | Annual Yield at SPAXX (4.97%) | FDIC Sweep (2.72%) | Chase Savings (0.01%) |
|---|---|---|---|
| $5,000 | $248.50 | $136 | $0.50 |
| $15,000 | $745.50 | $408 | $1.50 |
| $30,000 | $1,491 | $816 | $3.00 |
| $50,000 | $2,485 | $1,360 | $5.00 |
Switching to SPAXX
Step-by-step:
- Log in at fidelity.com → Accounts & Trade → Account Features
- Click “Core Position” under your Cash Management Account
- Select SPAXX → Confirm
- Change takes effect next business day
- All future uninvested cash sweeps into SPAXX automatically
Moving existing cash:
- In your CMA, go to Trade → Mutual Funds
- Search for SPAXX
- Buy using the “dollar amount” option
- Or: sell the FDIC sweep position → reinvest in SPAXX
Understanding the SPAXX Risk Profile
SPAXX is not FDIC insured. The risk profile:
- What it holds: US government securities, Treasury bills, government agency securities, repurchase agreements collateralized by government securities
- Default risk: Extremely low — backed by US government obligations
- Historical: Government money market funds have never broken the dollar
- SIPC protection: Covers up to $500,000 in securities if Fidelity itself fails
For most customers, the risk difference between SPAXX and an FDIC-insured savings account is negligible at typical savings amounts.
When the FDIC Sweep Makes Sense
- You have balances exceeding $250,000 that you want fully FDIC insured
- You are in a trust or business situation requiring FDIC coverage documentation
- You prefer unconditional government backing with no investment vehicle complexity
The FDIC sweep still earns ~2.72% — far better than Chase (0.01%) or Bank of America (0.01%).
Fidelity vs. Online HYSAs for Savings
| Option | Rate | FDIC Insured | Liquidity |
|---|---|---|---|
| Fidelity SPAXX | ~4.97% | No | Same-day (T+0) |
| Axos HYSA | 4.66% | Yes ($250K) | 1–3 day ACH |
| Discover HYSA | 4.25% | Yes ($250K) | 1–3 day ACH |
| Ally HYSA | 4.20% | Yes ($250K) | 1–3 day ACH |
| Marcus HYSA | 4.10% | Yes ($250K) | 1–3 day ACH |
SPAXX yields more than any traditional HYSA and settles same-day within Fidelity. The tradeoff is no FDIC insurance (though SIPC protection and government-only portfolio mitigate risk for most customers).
See also: Fidelity Cash Management review | Fidelity checking account | Best high-yield savings accounts | Fidelity vs. Schwab
The content on Wealthvieu is for informational purposes only and should not be considered financial, tax, or investment advice. Consult a qualified professional before making financial decisions. Full disclaimer · Editorial policy