By Dr. James M. Dahle, WCI Founder
It is not much different to do a Backdoor Roth IRA at Fidelity than it is at Vanguard, Charles Schwab, or anywhere else. The first step, of course, is making sure you have both a traditional IRA and a Roth IRA at Fidelity. It should only take a few minutes to open those up. Start with the traditional IRA.
Step 1: Contribute to Fidelity Traditional IRA
First, log into Fidelity. Then click on “Open an Account” at the top.
Select “Open a Traditional IRA.” On the next page, confirm your personal information and hit confirm.
Agree to the electronic delivery and open the account. Easy peasy.
You should now see it on the left side of the screen with your other Fidelity accounts.
Next, you'll need to fund that traditional IRA. It's easiest to just transfer it from your checking account.
Now you have $6,000 [2021 individual contribution limit] in your traditional IRA. You'll probably need to leave it in the traditional IRA one business day until you can see the $6,000 actually in the account. Now you just need to convert it to a Roth IRA.
Step 2: Convert Fidelity Traditional IRA to Roth IRA
If you don't yet have a Roth IRA at Fidelity, you can open one up from the exact same place you opened up the traditional IRA from.
Log back in the next business day and hit “Transfer” at the top.
Just transfer $6,000 from your traditional IRA to your Roth IRA.
Do not have taxes withheld because there will not be any due.
Convert the entire balance. Be sure to leave the account open for next year.
Step 3: Choose Your Fidelity Roth IRA Investments
You can now invest it into your preferred investment within the Roth IRA in the usual manner.
What do you think? Do you do your Backdoor Roth IRA at Fidelity? Why or why not? Comment below!