YouTuber Rob Berger also recently moved his 'checking account' activities to Fidelity, I presume for the same reasons as Harry Sit.
I've done much the same at Schwab, although the implementation details are a bit more clumsy and less obvious. Meaning I had to think through the setup.
My wife and I are overall happy with the arrangement. There are a couple of points I would emphasize:
As a matter of security, we should all note very carefully that our "checking" account and brokerage account share the same login and password. I consider this to be THE main downside to the idea, and it is a non-trivial trade-off. It may yet push me back to a separation. IIRC, there was a recent case of brokerage hacking and asset theft at Fidelity that took advantage of just this issue.
I take measures to mitigate the risk
1. No pulls from Schwab. Period. I use Schwab billpay for just about everything. I think I have two payments that the vendor requires a PULL payment. In that case I push money from Schwab to a local bank on Autopay, and I let those vendors PULL from the local bank.
2. Hardware token to gain access
Second, a much more minor point, but one I did not anticipate: Using Schwab for checking functions forces me to open Schwab relatively frequently. This can be viewed as a good thing since I am more likely to identify unexpected activity, but it interferes with my desire to not be swayed by stock market fluctuations, and to leave my investment plan alone for the long term. I haven't bought or sold stocks due to market gyrations, but I dislike the forced newsfeed.
@abq-goldgmail-com Good points????! Although it's impossible to be completely safe using the internet ????, there are steps you can take to hinder the low-life's out there. I change my passwords often, annoying but necessary ????. I also use a VPN ????. With Fidelity I use multi-factor authentication. Fidelity also offers "Money Transfer Lockdown" for each account. As far as protecting your money, some of your money is covered by Federal Deposit Insurance Corporation (FDIC) and some by Securities Investor Protection Corporation (SIPC). In addition to SIPC protection, Fidelity, through National Financial Service (NFS), provides its brokerage customers with additional “excess of SIPC” coverage from Lloyd’s of London together with other insurers. The excess of SIPC coverage would only be used when SIPC coverage is exhausted. Fidelity's security measures are presented in the attached pdf. I am not familiar with the recent case of brokerage hacking and asset theft at Fidelity you mentioned, but I feel as safe as is possible ????.
