Recurring investments on Fidelity are a fantastic way to build wealth over time, automating your savings and investment strategy so you can "set it and forget it," allowing you to pursue other priorities without constantly worrying about market timing. It’s essentially dollar-cost averaging on autopilot, which can be incredibly effective for long-term growth. Let's explore how to set up these recurring investments on Fidelity and delve into the compelling reasons why you should consider incorporating this strategy into your financial plan.

The process of setting up recurring investments on Fidelity is relatively straightforward. First, you need to have a Fidelity account, whether it's a brokerage account, Roth IRA, traditional IRA, or other eligible account type. Once you are logged in, navigate to the "Accounts & Trade" section, and then select "Account Features." Look for options like "Automatic Investments" or "Recurring Transfers," the exact wording may vary slightly depending on Fidelity's website update. Click on that, and you will be taken to a page where you can set up your recurring investment.

Here, you'll specify several key pieces of information. You will need to choose the source of your funds, this is typically your bank account, so you'll need to have it linked to your Fidelity account beforehand. You'll also need to select the destination account within Fidelity where the investment will be made, this could be your Roth IRA, your brokerage account, or other eligible Fidelity account. Then, specify the security you want to invest in. Fidelity offers a wide array of investment options, including stocks, ETFs, mutual funds, and even fractional shares. Select the investment that aligns with your investment goals and risk tolerance. If you're unsure, consider starting with broad market ETFs, such as those tracking the S&P 500 or total stock market.

Next, you will determine the investment amount. This is the amount of money you want to invest each time. Start with an amount that you can comfortably afford, even if it's a small amount like $25 or $50. Consistency is more important than the size of the initial investment. You should also determine the frequency of your investments, Fidelity allows you to choose between weekly, bi-weekly, monthly, or quarterly intervals. Choose the frequency that best suits your income and budgeting schedule. Finally, you’ll specify the start date for your recurring investments. Select a date in the future when you want the first transaction to occur. Review all the details carefully to ensure accuracy, and then confirm your recurring investment schedule. Fidelity will send you a confirmation email, and you can also view your scheduled investments in your account settings.

The "Why" behind setting up recurring investments on Fidelity is where the real magic happens. There are several compelling reasons to consider this strategy. One of the most significant benefits is dollar-cost averaging. By investing a fixed amount regularly, you buy more shares when prices are low and fewer shares when prices are high. This helps to smooth out your average purchase price and reduces the risk of investing a large sum all at once at a potentially unfavorable time. Over the long term, dollar-cost averaging can lead to better returns compared to trying to time the market.

Another key advantage is the power of automation. Life gets busy, and it's easy to forget to invest or get distracted by other priorities. Recurring investments automate the process, ensuring that you consistently invest in your financial future without having to actively remember to do so. This removes the emotional element from investing, preventing you from making impulsive decisions based on market fluctuations.

Consistency is paramount when it comes to investing, and recurring investments enforce this principle. Even small, regular investments can add up significantly over time, thanks to the power of compounding. Reinvesting dividends and earnings allows your investments to grow exponentially, generating even greater returns in the future. It's a simple, yet powerful, way to build wealth systematically.

Furthermore, recurring investments can help you overcome market volatility. Instead of panicking during market downturns, you continue to invest regularly, buying more shares at lower prices. When the market eventually rebounds, you'll benefit from the increased share count and potential for higher returns. This approach helps you stay disciplined and avoid selling low, which is a common mistake investors make during periods of market uncertainty.

Recurring investments on Fidelity are also incredibly flexible. You can easily adjust the investment amount, frequency, or even the securities you're investing in as your financial situation and investment goals change. If you get a raise, you can increase your recurring investment amount to accelerate your wealth-building efforts. If your risk tolerance changes, you can adjust your asset allocation accordingly.

In conclusion, setting up recurring investments on Fidelity is a simple yet highly effective strategy for building wealth over time. By automating your savings and investment process, you can take advantage of dollar-cost averaging, consistency, and the power of compounding. Whether you're a beginner or an experienced investor, recurring investments can help you achieve your financial goals with greater ease and confidence. It is a cornerstone of a smart, long-term investment strategy, fostering financial discipline and promoting sustainable wealth accumulation. Embrace the power of automation and let Fidelity's recurring investment feature work for you, paving the way towards a brighter financial future.