Yes, you can convert Fidelity Cash to a money market fund, but the process depends on which account type holds the cash

Fidelity Cash — sometimes called SPAXX or a similar money market fund — sits in many Fidelity accounts as the default cash position. You can move that cash into a different money market fund or another investment within the same account type. The steps differ slightly between a brokerage account, an IRA, a 401(k), and other account structures, because each has its own rules about what investments are available and how to move money between them.

The conversion itself is free and usually takes one business day to settle. You are not selling anything or triggering a taxable event — you are straightforward instructing Fidelity to move cash from one fund to another within an account you already own.

Key Takeaways

  • Fidelity Cash can be moved to another money market fund or investment within the same account through Fidelity's website, phone, or in-person at a branch.
  • The process is free and settles in one business day; no tax consequences occur because you are moving cash, not selling investments.
  • IRAs and 401(k)s have limited money market options compared to brokerage accounts, so check what is available in your specific account type before you start.
  • If you want to move cash between different account types — for example, from a brokerage account to an IRA — you must follow that account type's transfer rules, which may involve contribution limits or tax withholding.

How to convert Fidelity Cash through the website

Log into your Fidelity account and navigate to the Accounts tab. Find the account holding the cash you want to move. Click on the cash position (it will show as SPAXX or another money market fund name) and select "Exchange" or "Trade." This opens a form where you choose the destination fund — another money market fund, a bond fund, or any other investment available in that account type.

Enter the dollar amount or the number of shares you want to convert. Review the transaction details, including the fund name, amount, and settlement date. Confirm the order. Fidelity will show you a confirmation number when ready, and the cash will move into the new fund by the next business day.

If you cannot find the exchange option on the website, call Fidelity at the number on the back of your account statement. A representative can walk you through the process or execute the trade for you over the phone.

Money market fund options available at Fidelity

Fidelity offers several money market funds with different yield rates and expense ratios. Fidelity Government Money Market Fund (SPAXX) is the most common default. Fidelity Treasury Money Market Fund (FTXX) holds only U.S. Treasury securities and typically has a lower yield. Fidelity Institutional Money Market Fund (FDRXX) is available only in certain account types and often has a lower expense ratio.

In a brokerage account, you can also move cash into other short-term investments like short-term bond funds or CDs, though these are not technically money market funds. In an IRA or 401(k), your options are usually limited to the money market funds Fidelity offers within that plan. Check your account's investment menu to see which funds are available to you.

Converting cash in an IRA versus a brokerage account

In a traditional or Roth IRA, you can move cash between any investments Fidelity offers within that IRA without triggering a taxable event or counting against your annual contribution limit. The conversion is treated as a reallocation of funds already in the account. You can do this as many times as you want in a single year.

In a brokerage account, the same rule applies — moving cash between investments is free and has no tax consequences. However, a brokerage account gives you access to a much wider range of money market funds and short-term investments than an IRA typically does.

If you have a 401(k) through your employer, the money market options available depend on what your employer's plan includes. Some plans offer only a single money market fund; others offer two or three choices. You cannot add funds that are not on your plan's investment menu, even if Fidelity offers them elsewhere.

What happens to dividends and interest when you convert

Money market funds pay dividends daily or monthly, depending on the fund. When you convert from one money market fund to another, any dividends earned up to the settlement date stay in the original fund or are paid out according to your dividend reinvestment settings. Starting the next business day, dividends from the new fund begin accruing to your account.

This means there is no gap in earnings — you are straightforward switching which fund is earning the interest. If you have dividend reinvestment turned on, new dividends will automatically buy more shares of the new fund.

Converting cash between different account types

If you want to move cash from a brokerage account to an IRA, or from one IRA to another, that is a different process than converting within a single account. Moving money between account types is called a transfer or rollover, depending on the accounts involved, and it has specific rules and timelines.

A transfer between two IRAs you own can happen directly between institutions and does not count against contribution limits. A rollover from a 401(k) to an IRA has a 60-day window to complete and can only happen once per year per IRA. Moving money from a brokerage account to an IRA counts as a new contribution and is subject to annual contribution limits. If you are considering this type of move, contact Fidelity to confirm the exact steps and any limits that explore to your situation.

Frequently Asked Questions

Will converting Fidelity Cash to another money market fund change my tax situation?

No. Moving cash between investments within the same account type does not trigger a sale, so there are no capital gains or losses to report. In a taxable brokerage account, you will still owe taxes on the dividends the money market fund pays, but that is true regardless of which money market fund holds the cash.

Can I convert Fidelity Cash to a stock or bond fund instead of another money market fund?

Yes. You can move cash into any investment available in your account type — stocks, bonds, index funds, or other funds. The conversion process is the same. Keep in mind that stocks and bonds carry market risk that money market funds do not, so the value of your investment can go down as well as up.

How long does it take for the conversion to complete?

The conversion settles by the next business day. If you submit the order on a Friday, it will settle on Monday (unless Monday is a holiday). You can see the new fund in your account when ready after you confirm the order, but the cash will not be fully invested until settlement.

What if I want to convert only part of my Fidelity Cash balance?

You can specify a dollar amount or a number of shares when you place the order. The rest of your cash stays in the original fund. You can do this as many times as you want, moving different portions to different investments.

Is there a minimum amount I have to convert?

Fidelity does not set a universal minimum for conversions within an account. Some funds have minimum investment amounts — typically $1 or $2,500 depending on the fund — but most money market funds have no minimum. Check the fund's details page on Fidelity's website to see if a minimum applies to the fund you are moving into.