Fidelity's robo-advisor now offers tax-loss harvesting help on taxable accounts once they reach $25,000.
The giant asset manager added the feature on Wednesday.
"We’ll look for tax-loss harvesting opportunities in your Flex Funds that hold stocks, which can help you lower your tax bill," the Fidelity Go web page states.
It notes that tax-loss harvesting is a tool allowing clients to offset gains with losses from other investments.
"Once your balance reaches $25,000 in a Fidelity Go taxable account, tax-loss harvesting is automatically included," the site explains.
A Fidelity customer care channel on Reddit announced the move Wednesday.
"The addition of tax-loss harvesting is a major enhancement for Fidelity Go, adding a sophisticated tax-management layer to an already comprehensive platform," David Goldstone, Condor Capital Wealth Management investment research manager, said via email Thursday.
"We have long praised Fidelity for its client-friendly features, particularly its robust financial planning tools and access to live advisors for accounts over $25,000. The $25,000 minimum for this feature reflects Fidelity Go's pricing structure, as $25,000 is where the 0.35% advisory fee kicks in," Goldstone added.
Fidelity Go will monitor portfolios daily for opportunities to harvest losses to improve after-tax returns, he said.
"Fidelity’s recent introduction of this feature is in contrast to the major independents like Wealthfront and Betterment, which have offered tax-loss harvesting for over a decade," according to Goldstone.
"This underscores the long-term trend where independent robo-advisors have historically been the first to adopt newer technologies. Wealthfront launched the feature in 2012 and Betterment in 2014," he said.
"Incumbents have been slow to follow; Vanguard only introduced the feature to its digital clients in 2023, and Fidelity is adding it now," Goldstone noted.
Fidelity, in an emailed statement Thursday, said it added the feature the previous day, bringing another investment strategy to customers.
Fidelity already offered tax-loss harvesting and other tax-efficiency strategies in its wealth management services, separately managed accounts and managed, digital, direct-indexing FidFolios accounts.
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