What Fidelity money market funds foreign investors can actually access

Foreign investors can open accounts at Fidelity and buy most of the same money market funds that U.S. citizens can, but the specific funds available depend on your country of residence and tax status. Fidelity does not restrict money market funds by investor nationality — the limitation comes from U.S. tax law and your home country's regulations. You will need a valid tax identification number (often an ITIN if you are not a U.S. citizen), proof of address, and documentation of your source of funds.

The most commonly available option for foreign investors is Fidelity Government Money Market Fund (SPAXX), which holds short-term U.S. Treasury securities and is considered one of the lowest-risk options. Fidelity also offers Prime Money Market Fund (MMRXX) for those seeking slightly higher yields through commercial paper and bank certificates of deposit. Both funds are available through most Fidelity brokerage accounts, though some countries have restrictions on which funds their residents can purchase due to local securities regulations.

Key Takeaways

  • Foreign investors can purchase Fidelity money market funds through a standard brokerage account, but must provide an ITIN or equivalent tax identification and proof of address.
  • Government Money Market Fund (SPAXX) and Prime Money Market Fund (MMRXX) are the two main options, with SPAXX holding only Treasury securities and MMRXX offering higher yields through corporate instruments.
  • Your country of residence determines whether you can open an account and which funds are available to you, as some nations restrict their residents from certain U.S. investments.
  • Withholding taxes on interest income vary by country and depend on tax treaties between the U.S. and your home nation.

How to open a Fidelity account as a foreign investor

Fidelity accepts foreign investors but requires additional documentation beyond what a U.S. resident provides. You will need a government-issued photo ID, proof of your current address (typically a utility bill or bank statement dated within the last 90 days), and either a U.S. tax identification number or an Individual Taxpayer Identification Number (ITIN). If you do not have an ITIN, you can request one from the IRS using Form W-7, though this adds time to the account opening process.

You must also declare your country of citizenship and tax residence. Fidelity uses this information to determine which funds you can purchase and what tax forms you will need to complete. Some countries are on restricted lists due to U.S. sanctions or regulatory agreements, and residents of those nations cannot open accounts. You can contact Fidelity's international account services to confirm whether your country is supported before beginning the application.

The account opening process itself happens online or by phone, and Fidelity will ask about the source of your funds — this is a standard anti-money-laundering requirement, not a judgment on your account. Be prepared to explain where the money comes from (employment, savings, inheritance, business income, etc.). Once approved, you can fund the account by wire transfer, which is the most common method for foreign investors.

Tax withholding on money market fund interest

Interest earned in a Fidelity money market fund is subject to U.S. federal withholding tax, typically 30 percent, unless your country has a tax treaty with the United States that reduces this rate. The withholding happens automatically — Fidelity deducts it before sending you the interest payment. The amount withheld depends on the tax treaty between your home country and the U.S., and some treaties reduce the rate to 15 percent or lower.

You may be able to reclaim some or all of the withheld tax through your home country's tax authority, depending on local law and the specific treaty. This process varies significantly by country and often requires filing additional forms with both the IRS and your local tax agency. Before opening an account, research the tax treaty between your country and the United States, or ask Fidelity's tax department what withholding rate applies to your situation.

Keep detailed records of all interest payments and withholding amounts, as you will need these when filing taxes in both countries. Some foreign investors find that the after-tax yield on U.S. money market funds is lower than they expected once withholding is factored in, so it is worth calculating this before committing significant funds.

Differences between SPAXX and MMRXX for foreign investors

SPAXX (Government Money Market Fund) invests exclusively in U.S. Treasury bills, notes, and repurchase agreements backed by Treasuries. It has the lowest risk profile because the U.S. government backs every holding. The yield is lower than other money market options — currently in the range of 4 to 5 percent depending on market conditions — but the stability is unmatched. SPAXX is the better choice if you prioritize safety over returns or if you are using the fund as a temporary holding place for cash.

MMRXX (Prime Money Market Fund) holds a mix of commercial paper, bank certificates of deposit, and other short-term corporate debt in addition to some government securities. Because it takes on slightly more credit risk, it typically yields 0.5 to 1 percent more than SPAXX. However, during periods of financial stress, prime money market funds can experience losses or temporary restrictions on withdrawals, though this is rare. MMRXX is appropriate if you have a longer time horizon and can tolerate modest risk for higher returns.

Both funds are available to foreign investors, though some countries restrict access to MMRXX due to local regulations. Check with Fidelity before opening your account to confirm which funds you can purchase from your location. The choice between them should reflect your risk tolerance and how long you plan to hold the money.

Currency risk and exchange rates

Money market funds at Fidelity are denominated in U.S. dollars, which means you face currency risk if your home currency is not the dollar. When you wire money into your account, you convert your local currency to dollars at the exchange rate on that day. When you withdraw funds later, you convert back at whatever the rate is at that time. If your currency strengthens against the dollar, you gain; if it weakens, you lose, regardless of how well the fund itself performs.

This currency exposure is separate from the fund's performance and can be significant over longer periods. A money market fund earning 4.5 percent in dollars could deliver a negative return to you if your currency appreciates 6 percent against the dollar during the same period. Some foreign investors hedge this risk using currency forwards or options, but these tools add cost and complexity. Others accept the currency risk as part of investing in U.S. dollar assets.

Before investing, consider how long you plan to keep money in the account and whether you need the funds in dollars or your home currency. If you need the money in your local currency, factor in both the fund's yield and your expectations for exchange rate movement.

Account minimums and fees for foreign investors

Fidelity's money market funds typically have no minimum initial investment when purchased through a brokerage account, though some retirement accounts have minimums of $2,500 or more. Foreign investors can open a standard taxable brokerage account with no minimum, making it possible to start with any amount. However, wire transfer fees may apply depending on your bank and Fidelity's policies — these typically range from $10 to $50 per transfer.

Fidelity does not charge management fees on money market funds; the expense ratio is covered by the fund itself and is already reflected in the yield you see quoted. You will not see a separate fee deducted from your account for holding the fund. However, if you use Fidelity's advisory services or hold other investments, those may carry separate fees.

Some foreign investors find that the combination of wire transfer fees, currency conversion costs, and tax withholding makes small accounts uneconomical. If you are investing less than $5,000, calculate the total cost of getting money in and out before opening the account.

Restrictions by country and regulatory considerations

Fidelity maintains a list of countries where it cannot accept new account applications due to U.S. sanctions, regulatory restrictions, or local laws that prohibit residents from holding certain U.S. investments. This list changes periodically as regulations evolve. Countries with comprehensive sanctions programs (such as Iran, North Korea, Syria, and Cuba) are completely restricted. Some other countries have partial restrictions on specific fund types or account structures.

Even if your country is not on a restricted list, your individual circumstances may prevent account opening — for example, if you are a politically exposed person (PEP) or have connections to sanctioned entities, Fidelity may decline your application. This is not a reflection on you personally; it is a compliance requirement that all U.S. financial institutions must follow.

Before spending time on an application, contact Fidelity's international account services and confirm that residents of your country can open accounts and purchase money market funds. This conversation takes 10 minutes and can save you from starting an application that will be denied.

Frequently Asked Questions

Can I buy Fidelity money market funds if I live outside the United States?

Yes, as long as you are not a resident of a country under U.S. sanctions or subject to local restrictions on U.S. investments. You will need a tax identification number, proof of address, and to complete additional compliance documentation. Contact Fidelity's international services to confirm your country is supported before applying.

What is the difference between SPAXX and MMRXX in terms of safety?

SPAXX holds only U.S. Treasury securities, making it the safest option with virtually no credit risk. MMRXX includes corporate debt and bank instruments, which carry slightly more risk but typically offer higher yields. Both are considered low-risk, but SPAXX is the more conservative choice.

How much tax will be withheld from my money market fund interest?

The standard U.S. withholding rate is 30 percent, but this may be reduced by a tax treaty between your country and the United States. Rates vary from 15 to 30 percent depending on your country of residence. Contact Fidelity's tax department with your country of residence to learn the exact rate that applies to you.

Do I need a U.S. Social Security number to open a Fidelity account?

No. Foreign investors without a U.S. Social Security number can obtain an Individual Taxpayer Identification Number (ITIN) from the IRS using Form W-7. This process takes several weeks, but Fidelity can help you understand the steps. Some foreign investors use their passport number or national ID number during account opening if they do not yet have an ITIN.

What happens to my money if Fidelity fails?

Money market funds are not bank deposits, so they are not covered by FDIC insurance. However, they are protected by the Securities Investor Protection Corporation (SIPC) up to $500,000 per account. Additionally, the securities held inside the fund (Treasuries and commercial paper) are separate from Fidelity's own assets, so your money is protected even if Fidelity itself encounters financial trouble.