What you need to do to open a Fidelity Roth IRA

Opening a Fidelity Roth IRA takes about 10 to 15 minutes online. You'll go to Fidelity's website, create an account, answer questions about your income and employment, link a bank account for funding, and choose how to invest the money inside the account. Fidelity will verify your identity using information from your credit file, and your account will be ready to fund immediately after that verification passes.

You don't need to have money ready before you start. Many people open the account first, then transfer or deposit funds later. The account itself is free to open and has no monthly fees.

Key Takeaways

  • You must have earned income in the year you open the account, and your income cannot exceed the limits Fidelity will show you during signup (these limits change yearly).
  • The online signup process asks for your Social Security number, date of birth, address, and employment information so Fidelity can verify your identity.
  • After you create your account, you choose an investment option — Fidelity offers individual stocks and funds, or a simple target-date fund that adjusts automatically as you age.
  • You can fund the account by linking a bank account for an electronic transfer, or by mailing a check, but electronic transfer is faster and more common.

Verify your income and identity before you start

Fidelity will ask you to confirm your earned income for the current year during signup. Earned income means wages from a job, self-employment income, or alimony — not investment returns, Social Security, or retirement distributions. If you don't have earned income this year, you cannot open a Roth IRA, even if you had income in previous years.

You'll also need to provide your Social Security number, date of birth, current address, and employment details. Fidelity uses this information to verify your identity through a third-party service. The verification usually completes within minutes, but occasionally Fidelity may ask you to provide additional documents like a driver's license or recent utility bill. If that happens, you can upload them through your account or mail them to Fidelity.

Your income also cannot exceed the annual limit for Roth IRA contributions. This limit changes each year and depends on your filing status (single, married filing jointly, etc.). Fidelity will show you the current limit during signup and tell you whether your stated income falls within it.

Create your Fidelity account and choose your investment option

Once identity verification passes, you'll create a username and password for your Fidelity account. You'll then choose how you want the money inside your Roth IRA to be invested. Fidelity offers three main paths: individual stocks and mutual funds that you pick yourself, a robo-advisor service called Fidelity Go that builds a portfolio based on your age and risk tolerance, or a target-date fund that automatically shifts from stocks to bonds as you approach retirement.

If you're not sure which to choose, a target-date fund is the simplest option. You pick the fund that matches the year you plan to retire (for example, "Fidelity Freedom Index 2055"), and the fund automatically rebalances itself. You don't have to make any other investment decisions.

If you want to pick individual investments, Fidelity will show you a list of funds and stocks you can buy. You can also choose to leave the account empty for now and decide on investments later — the account will be open and ready to receive money.

Link your bank account and fund the account

To deposit money into your new Roth IRA, you'll link a checking or savings account at another bank. Fidelity will ask for your bank's routing number and your account number. You can find both on a check, or by logging into your bank's website.

After you link your bank account, Fidelity will send two small test deposits (usually under $1 each) to verify the account is real. You'll need to confirm the amounts of those deposits back in your Fidelity account — this usually takes one to two business days. Once confirmed, you can transfer money from your bank account to your Roth IRA.

Electronic transfers typically arrive within one to three business days. If you prefer to mail a check instead, write "Roth IRA" on the memo line and mail it to the address Fidelity provides in your account. Mailed checks take longer to process — usually five to ten business days after Fidelity receives them.

Understand the contribution limit for the year

The amount you can deposit into a Roth IRA each year is capped by law. For 2024, the limit is $7,000 if you're under 50, or $8,000 if you're 50 or older. This limit applies across all Roth IRAs you own — if you have a Roth IRA at another bank and contribute $3,000 there, you can only contribute $4,000 to your Fidelity Roth IRA that same year.

You can contribute up to the limit as long as you have earned income for the year. You don't have to contribute all at once — you can deposit money throughout the year, or wait until the tax deadline the following year to make your contribution for the previous year.

If you contribute more than the limit, Fidelity will charge you a penalty tax on the excess. It's your responsibility to track your total contributions across all accounts and stay within the limit.

What happens after your account is open

Once your account is funded and your investments are chosen, your Roth IRA will begin growing. You can log into your Fidelity account anytime to see your balance, change your investments, or make additional contributions. You can also set up automatic monthly transfers from your bank account if you want to contribute a fixed amount each month.

You won't owe taxes on the money that grows inside the account, and you won't owe taxes when you withdraw it in retirement — that's the main benefit of a Roth IRA. However, you generally cannot withdraw the earnings (the investment gains) before age 59½ without paying a penalty, though you can withdraw the contributions themselves anytime without penalty.

Frequently Asked Questions

Can I open a Fidelity Roth IRA if I'm self-employed?

Yes. Self-employment income counts as earned income for Roth IRA purposes. You'll need to report your net self-employment income (after business expenses) during signup. If you're self-employed, you may also be able to open a SEP IRA or Solo 401(k), which allow much larger contributions, but you can have both a Roth IRA and one of those plans in the same year.

What if I don't have a bank account to link?

You can mail a check to Fidelity instead of linking a bank account. Write "Roth IRA" on the memo line and include a note with your account number. Fidelity will deposit the check and credit your account, though it takes longer than an electronic transfer.

Can I move money from another Roth IRA into my Fidelity Roth IRA?

Yes. If you have a Roth IRA at another bank, you can transfer it to Fidelity. Contact Fidelity's transfer team, and they'll handle the paperwork with your old bank. The transfer doesn't count against your annual contribution limit and doesn't trigger taxes.

What if Fidelity rejects my identity verification?

If the automated verification fails, Fidelity will ask you to provide additional documents like a driver's license or passport. You can upload these through your account or mail them. Once Fidelity receives and reviews them, verification usually completes within a few business days. If you're still unable to verify, contact Fidelity's customer service for help.

Do I have to invest the money right away?

No. You can open the account, fund it, and leave the money in Fidelity's cash management account (which earns a small amount of interest) while you decide how to invest it. However, money sitting in cash won't grow as much as money invested in stocks or funds, so most people choose an investment option fairly quickly.