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Fidelity offers to pay customers for new IRA business

Fidelity Investments wants your IRA business enough to pay you for it.

The Boston-based investment giant said Wednesday it’s rolling out an offer to pay customers for moving at least $10,000 into a new or existing Fidelity retirement account and then contributing more money to it annually. The dollar-matching offer — up to 10 percent of the additional contributions — would be paid over the next three years.

For example, a customer who transfers $500,000 into a Fidelity IRA from another investment firm would qualify for a 10 percent match on future contributions. On annual contributions of $5,500, the customer would get a $550 match per year.


Fidelity, the largest IRA provider, believes the offer is the first of its kind. It’s not unlike the deals cellphone carriers and banks sometimes promote to encourage consumers to switch service. But there’s potentially more money at stake with a retirement account.

“It takes a lot to have someone switch,” said James Lowell, editor of the independent newsletter Fidelity Investor. For customers to consider it, he said, Fidelity must “make a credible case for their incentive — in addition to the pitch of the necessity of saving for retirement.”

The match does not apply to rollovers from 401(k) or 403(b) plans, which indicates Fidelity is really looking to take business away from IRA competitors. It also seems to be trying to attract people who already have healthy nest eggs.

Fidelity’s offer is considerably more modest for customers moving smaller balances. A $10,000 account, for instance, would get a 1 percent match. And $2,000 annual contributions made after that would reap just $20.

Lauren Brouhard, senior vice president for retirement at Fidelity, declined to say how much the program might cost the company. She said Fidelity decided an incentive could work in the same way employer matches encourage workers to contribute to their 401(k) accounts.


“Helping people get over procrastination and create new habits is really what’s going to help them over the long term,’’ Brouhard said.

Beth Healy can be reached at beth.healy@globe.com. Follow her on Twitter @HealyBeth.