New Resources Help Strengthen Client Relationships
and Capture Rollover Assets

BOSTON, January 29, 2002 - While making the most of accumulated retirement assets is critical for retirees, it is equally important for those investors who may be changing jobs or retiring early.

Fidelity Investments Institutional Services Company, Inc. (FIIS) announced today that it has added new business-building resources -- highlighting the Net Unrealized Appreciation (NUA) and Substantially Equal Periodic Payment (72t) strategies -- to its Right Moves^TM program for investment professionals. These resources offer investment professionals education and sales ideas on two often overlooked distribution strategies for investors who may need to access their retirement assets because of early retirement or a change in jobs.

"In a perfect world, employees who participate in a 401(k) plan and are separated from service with their employer should consider looking to maintain the tax- deferred status of their assets and limit exposure to taxes and early withdrawal penalties," said Marty Willis, executive vice president, Fidelity Investments Institutional Services Company. "However, every investor's situation is unique and there may be instances when they need to access their retirement assets prior to retirement.

"The decisions that need to be made around the distribution of retirement plan assets when an investor changes jobs or retires early can be complex and are likely to have a lasting impact on income during retirement. An investment professional can help investors understand their distribution options and develop a strategy that meets their particular income needs," continued Willis.

When changing jobs or retiring early, investors may have a number of different options available with regard to the distribution of their workplace retirement plan assets, including: leaving the assets invested in the former employer's retirement plan; rolling the assets into a new employer's retirement plan; rolling the assets over (directly or indirectly) into an individual retirement account; or taking the distribution of assets in cash.

In addition to the more traditional distribution options, the NUA strategy may be appropriate for investors who have highly appreciated employer stock in their 401 (k) plan, while the 72(t) strategy may be appropriate for those IRA owners or workplace retirement plan participants who have changed jobs or retired early and who need access to their retirement assets prior to retirement.

Net Unrealized Appreciation

NUA is the difference between the cost basis (total cost of the stock when purchased through the plan) of employer stock held in a 401(k) plan and its fair market value when distributed in-kind from the plan. Investors who own highly appreciated employer stock in their 401(k) plans may be able to take advantage of special tax treatment applied to NUA and potentially reduce the tax liability on that stock.

To take advantage of the NUA strategy, an investor must be able to take a distribution from his or her plan. This can usually be done after leaving an employer for another job or taking early retirement, but will depend on the plan's terms. The investor then must take a lump-sum distribution of all assets from their plan, with the stock being distributed in-kind. Federal income tax¹ on the cost basis of the distributed stock must then be paid.² The investor can then sell the employer stock at any time -- paying capital gains tax, rather than federal income tax, on the appreciation, which may result in significant savings for investors in high tax brackets. All remaining assets eligible to be rolled over from their plan must be directly rolled over into an IRA (or another eligible retirement plan that accepts rollovers) to maintain their tax-deferred status and avoid taxes and early withdrawal penalties.

72(t)

Section 72(t) of the Internal Revenue Code (IRC) provides several exceptions to the 10% penalty for early withdrawals from retirement accounts, such as employer-sponsored retirement plans. One of these exceptions allows penalty- free access to plan assets if the investor agrees to take a series of substantially equal periodic payments -- at least annually -- from his or her retirement plan for at least five years or until age 59½ ³ , whichever is longer.⁴ This exception is commonly referred to as "72(t) distributions" or "72 (t)." For employer-sponsored plans, a distributable event such as separation from service must occur in order to take advantage of 72(t). This strategy may be appropriate for investors with substantial retirement assets who may need to tap them before the age at which distributions may be taken without penalty. If an investor's employer-sponsored plan does not allow substantially equal periodic payments, they would need to roll over those assets into an IRA following a distributable event to take advantage of this strategy.

"Each of these strategies not only provide investment professionals with additional potential distribution options they can present to their clients, but they also offer investment professionals an excellent way to add additional value to their client relationships and potentially build their book of business," said Willis.

As part of the new Right Moves NUA and 72(t) resources, FIIS has developed a number of tools and shareholder-approved materials to support investment professionals. These include sales ideas, investor insights, a prospecting letter, a client seminar and invitation, a newsletter article, and an NUA and 72 (t) reference card that provides investment professionals with answers to commonly asked questions and a checklist that helps determine if these options may be right for their clients. These materials are available at www.advisorxpress.com FIIS' Web site for investment professionals.

About FIIS

FIIS provides investment management services to more than 4,200 financial institutions, including wirehouses, regional and independent broker/dealers, banks, trust companies and insurance companies. The company offers Fidelity Advisor Funds®, Variable Insurance Product (VIP) Funds, systematic investment plans, institutional money market funds, and a comprehensive line of retirement products and services, exclusively through investment professionals. FIIS' total assets under management were $189.1 billion as of November 30, 2001. For more information about FIIS, investment professionals should visit www.advisorxpress.com.

About Fidelity

Fidelity Investments is one of the world's largest providers of financial services with custodied assets of $1.5 trillion, including managed assets of $883.4 billion. Fidelity offers investment management, retirement, brokerage and shareholder services to 17 million individuals and institutions as well as through 5,500 financial intermediaries. The firm is the largest mutual fund company in the United States, the No. 1 provider of workplace retirement savings plans, one of the largest mutual fund supermarkets and a leading online brokerage firm. Fidelity Investments' Web site is at www.fidelity.com.

¹ Income taxed at ordinary federal income tax rates.
²If the investor is younger than 55 when they separate from service, they may also owe a 10% early withdrawal penalty, but only on the cost basis of the stock. However, any eligible rollover distribution not directly rolled over into an eligible retirement plan may also be subject to federal income taxes and an early withdrawal penalty.
³ May be until age 55 under some circumstances.
⁴ Investors must still pay ordinary income tax on the amount distributed. Not all employer-sponsored retirement plans allow substantially equal periodic payments.

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Fidelity Advisor Funds is a registered trademark of FMR Corp.

Fidelity Investments Institutional Services Company., Inc.
82 Devonshire St., Boston, MA 02109.