- Checking account<\/li>
- Negotiable order of withdrawal (NOW) account, <\/li>
- Savings account<\/li>
- Money market deposit account (MMDA), <\/li>
- Certificate of deposit (CD)<\/li>
- Cashier’s Check or Money Order issued by a bank <\/li><\/ul>\n\n\n\n
If you have a core position (cash inside your account) within your Roth IRA account, it may be FDIC insured. Contact your brokerage firm for more information. <\/p>\n\n\n\n
Here’s How the Core Position Works in your Fidelity Account<\/strong><\/h3>\n\n\n\n
Let’s say you contribute $4,000 to your Roth IRA account. You use $3,000 to invest in stocks. That means you have $1,000 uninvested cash. <\/p>\n\n\n\n
This uninvested cash will remain in a core position that is automatically established when you sign up for a Fidelity account. The core position will be used for processing cash transactions, buying securities in your portfolio, and holding uninvested cash. <\/p>\n\n\n\n
Let’s say you sell $2,000 worth of stock in your portfolio. The $2,000 will be deposited in your core position. <\/strong><\/p>\n\n\n\n
Roth IRAs at Fidelity have three core positions. <\/p>\n\n\n\n
- SPAXX<\/strong> – FIDELITY GOVERNMENT MONEY MARKET<\/li>
- FDIC<\/strong> – FDIC-Insured Deposit Sweep Program<\/li>
- FDRXX<\/strong> – Fidelity\u00ae<\/sup> Government Cash ReservesYour cash is invested in a mutual fund and earns<\/li><\/ul>\n\n\n\n
The only core position<\/span><\/strong> that is covered under FDIC Insurance is the FDIC-Insured Deposit Sweep Program<\/strong>. This is an interest-bearing position that is eligible for FDIC insurance. You can change your core position choice in your fidelity account. <\/p>\n\n\n\n
What Happens to the Money in your Account that is Not Eligible for FDIC Insurance? <\/strong><\/h3>\n\n\n\n
That’s where SIPC (Securities Investor Protection Corporation) coverage saves the day. <\/p>\n\n\n\n
SIPC covers up to $500,000 in securities which includes a $250,000 limit for cash held in a brokerage account. <\/p>\n\n\n\n
All Fidelity Roth IRA accounts are covered by SIPC. Talk to your brokerage firm to find out about specific coverage. <\/p>\n\n\n\n
Remember, SIPC does not protect against negative performance in the markets. If you invest $2,000 in securities and the value of your investments decline to zero, you are not protected. <\/p>\n\n\n\n
When you invest in the market, there is no guarantee of profits. You could lose money if a company doesn’t perform well. <\/p>\n\n\n\n
Join our Premium Subscription! <\/h3>\n\n\n\n
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- FDIC<\/strong> – FDIC-Insured Deposit Sweep Program<\/li>
- SPAXX<\/strong> – FIDELITY GOVERNMENT MONEY MARKET<\/li>