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Flagstar Bank Review: Checking, Savings, CD, Money Market and IRA Accounts

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Flagstar Bank checking account options

SimplyChecking

You don’t earn any interest with this account, but you could get perks like rate discounts for loans and increased rates for CDs.
  • Minimum opening deposit: $50
  • Monthly account maintenance fee: None
  • ATM fee: $2.50 for out-of-network ATMs
  • ATM fee refund: None, according to bank representative
  • Overdraft fee: $36

The SimplyChecking account is great for those wanting a basic checking account option without needing to worry about monthly fees or minimum deposit requirements. This account also requires a fairly low minimum opening deposit and over 55,000 surcharge-free ATMs at Flagstar Bank and the Allpoint network. Other features include a free Visa debit or ATM card, free bill pay, mobile deposit, online, telephone and mobile banking.

If you have more than $5,000 in deposits across your Flagstar Bank checking, savings and money market accounts, you could get preferred CD rates — not including promo rates. These rates aren’t currently being advertised on their website so you’ll need to call the bank to find out. Account holders are also eligible for a 0.50% rate reduction if you make automatic payments from this account toward your Flagstar Bank home equity loans, home equity lines of credit or personal loans.

How to get the SimplyChecking account

You need to open an account at any one of Flagstar Bank’s branch locations. You can call 1-888-248-6423 for more information on what to bring, but you’ll most likely need to bring your government-issued ID and Social Security number.

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SimplyPlus+ Checking

The rates aren’t great but you do get ATM refunds and the ability to waive the monthly maintenance fee.
APYMinimum Balance to Earn APY
0.03%$0
0.03%$1,000
0.05%$10,000
0.05%$25,000
  • Minimum opening deposit: $50
  • Monthly account maintenance fee: $10 (this can be waived)
  • ATM fee: $2.50 for out-of-network ATMs
  • ATM fee refund: Up to 2 times each month
  • Overdraft fee: $36

The SimplyPlus+ Checking account is slightly above the SimplyChecking account in that you do earn interest and receive two ATM refunds. However, the rates are miniscule and they charge a $10 monthly maintenance fee. On the bright side, you can get that waived if you can maintain a minimum average daily balance of $1,000, or $5,000 across your Flagstar checking, saving and money market accounts or if you’re at least 50 years old. You also receive a free box of checks each year.

Like the SimplyChecking account, you get a free Visa debit/ATM card, bill pay, mobile check deposit, online, mobile and telephone banking. You can also get access to over 55,000 surcharge-free ATMs through the Allpoint network. If you have a personal loan, home equity line of credit or a home equity loan, you may be eligible to receive a 0.50% rate reduction if you enroll in autopay from this account. You may also qualify for better CD rates if you maintain a minimum of $5,000 in the account, though you’ll need to contact the bank to see what they are.

How to get the SimplyPlus+ Checking

You need to open an account in person. You can call 1-888-248-6423 for more information but you’ll most likely need to bring your government-issued ID and Social Security number.

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on Flagstar Bank’s secure website

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SimplyMax Checking

You can get a higher APY and more ATM refunds, but it comes with a higher monthly maintenance fee.
APYMinimum Balance to Earn APY
0.05%$0
0.10%$5,000
0.15%$25,000
0.15%$50,000
0.15%$100,000
0.15%$1,000,000
  • Minimum opening deposit: $50
  • Monthly account maintenance fee: $25 (this can be waived)
  • ATM fee: None
  • ATM fee refund: Up to $20 each month upon request
  • Overdraft fee: $36

This checking account offers the highest APY out of all Flagstar Bank but it requires a high minimum deposit amount in order to qualify for it. The monthly maintenance fee seems pretty steep but you can waive it if you maintain a minimum average daily balance of $5,000 or have $25,000 in combined balances from Flagstar bank deposit accounts (except IRA products).

Like the other checking accounts, you could get a rate reduction on home equity line of credit, home equity and personal loans. You may also qualify for higher CD rates, though you’ll need to contact the bank to find out what they are. Other features include a free Visa debit or ATM card, bill pay, mobile, online and telephone banking. Account holders also get a box of checks for free each year.

How to get the SimplyMax Checking account

You’ll need to head to a local branch to open an account. To find out more, call customer service at 1-888-248-6423.

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on Flagstar Bank’s secure website

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How Flagstar Bank’s checking accounts compare

We’re sad to say that Flagstar Bank’s checking account rates don’t even come close to what is being offered out there. Other places on our list of the best online checking accounts have low or no monthly maintenance fees (that doesn’t require minimum balance amounts like Flagstar Bank does) and some even offer ATM refunds. Flagstar Bank does offer some ATM refunds with their SimplyPlus+ and SimplyMax checking accounts, but they’re limited to a certain amount per month.

Trust us, you’re probably better off looking elsewhere.

Flagstar Bank savings account options

SimplySavings

The APY is miniscule but you do get ATM access.
APYMinimum Balance to Earn APY
0.10% (regular rate)$0.01
1.30% (promo rate) $0.01
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: $3 (this can be waived)
  • ATM fee: $2.50 for out-of-network ATMs
  • ATM fee refund: None, according to bank representative
  • Overdraft fee: N/A

This savings account offers a low monthly maintenance fee and a promotion rate for new money only, which Flagstar Bank defines as money currently not on deposit with the bank. The rate is only available for Michigan residents. This rate will only be for the first 12 months after account opening and it’ll fall back down to the regular rate afterward.

To waive the monthly maintenance fee, you’ll need to either maintain a $300 minimum average balance or if you have a Flagstar Bank checking account. Other features of the account include a free Visa debit/ATM card, online, mobile and telephone banking. There’s also a rate reduction for personal and home equity loans, plus preferred CD rates if you maintain a minimum of $5,000 in your account. Federal Regulation D allows you up to six certain debits a month, so you’ll need to fork over $10 in excessive transaction fees to the bank if you go over the allotted amount.

How to get the SimplySavings account

Currently, you can only open an account in person.

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on Flagstar Bank’s secure website

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SimplyMax Savings

The promo rate is pretty good considering there isn’t a minimum balance requirement.
APYMinimum Balance to Earn APY
1.30% (promo rate)$0.01
0.05% $0.01
0.10%$5,000
0.15%$25,000
0.15%$50,000
0.15%$100,000
0.15%$1,000,000
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: $25 (this can be waived)
  • ATM fee: $2.50 for out-of-network ATMs
  • ATM fee refund: None
  • Overdraft fee: N/A

The SimplyMax Savings account also offers a promo rate for new money, meaning cash that isn’t currently on deposit with the bank. Unfortunately, it’s only limited to Michigan residents. After 12 months of account opening, it’ll go back to the regular rate.

Like the SimplySavings account, you get a free Visa debit/ATM card, bill pay, online, mobile and telephone banking. You also get preferred rates for a CD account if you maintain a minimum of $5,000 in combined account balances, and a rate reduction on your personal or home equity loans if you make auto payments with this account.

You can waive the monthly maintenance fee if you have a Flagstar Bank checking account or maintain a minimum average daily balance of $25,000. Since this is a savings account, you’re allowed up to six certain debits a month as mandated by Regulation D. Otherwise, you’ll need to pay a $10 excess transaction fee to the bank for each withdrawal you exceed.

How to get the SimplyMax Savings

You can only open an account at a local branch.

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on Flagstar Bank’s secure website

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High-Yield Savings

These are the highest savings rates Flagstar Bank offers, but the promo rate has restrictive requirements.
APYMinimum Balance to Earn APY
1.30% (promo rate)$0.01
0.05% $0.01
0.70%$50,000
0.90%$100,000
1.11%$250,000
1.20%$500,000
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: $35 (this can be waived)
  • ATM fee: $2.50 for out-of-network ATMs
  • ATM fee refund: None, according to a bank representative
  • Overdraft fee: N/A

Like the other savings accounts mentioned above, the High-Yield savings account is also offering a promo rate that doesn’t have any minimum balance requirements. It’s only available to Michigan residents and the rate is for the first 12 months of account opening. You’ll need new money for this account, meaning any cash that isn’t currently on deposit with Flagstar Bank. After the promo period, it goes down to the regular rate.

The monthly maintenance fee seems a bit steep but you can get it waived if you have a checking account or keep a $50,000 minimum daily average balance. You also get free bill pay, mobile deposit, a Visa debit/ATM card, mobile, online or telephone banking. Remember, Regulation D allows you up to six certain debits each month and you could be paying $10 for each excessive transaction to the bank.

How to get the High-Yield Savings account

Currently, the only option to open an account is in person.

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on Flagstar Bank’s secure website

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SimplyKids Savings

For those until the age of 23.
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: None
  • ATM fee: $2.50 for out-of-network ATMs
  • ATM fee refund: None, according to bank representative
  • Overdraft fee: N/A

The SimplyKids savings account is for children and needs a parent or guardian as a joint owner. Only those 13 years and up can receive a Visa debit or ATM card. Otherwise, you can only make transfers between the parental and minor account, said a bank representative. Account holders are allowed up to six certain debits a month because of Regulation D or else you’ll be charged a $10 excessive transaction fee from the bank.

With this account, you get higher rates on your first $500 deposited, free online statements, online and telephone banking. If you maintain at least $5,000 in combined deposit accounts you could qualify for preferred CD rates, though you’ll need to check with Flagstar Bank to find out current rates.

Once the child turns 23 years old, the SimplyKids savings account will automatically be converted to the SimplySavings account.

How to get the SimplyKids Savings account

You need to open an account in person.

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on Flagstar Bank’s secure website

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How Flagstar Bank’s savings accounts compare

Overall, their promo rates fall slightly short of some off the best offerings out there. Flagstar Bank also doesn’t require a minimum opening or deposit amount on its savings accounts, which we think is great.

You can only open the SimplyKids account in person, which can be limiting depending on your location. If that’s the case, then you may want to look at our list of the best online savings accounts.

Flagstar Bank CD rates

Certificate of deposit

These fixed-rate CDs aren’t really that great, though it does have a low minimum opening deposit.
TermAPY
30 to 89 days0.10%
90 to 179 days0.10%
180 to 364 days0.15%
12 to 17 months0.40%
18 to 23 months0.45%
24 to 29 months0.55%
30 to 35 months0.55%
36 to 47 months0.55%
48 to 59 months0.60%
60 to 71 months0.70%
72 to 83 months0.70%
84 to 95 months0.70%
96 to 107 months0.70%
108 to 120 months0.70%
  • Minimum opening deposit: $500
  • Minimum balance amount to earn APY: $500
  • Early withdrawal penalty: Depends on length of term:
    • 30 to 179 days — 30 days’ interest
    • 180 to 364 days — 90 days’ interest
    • 12 to 35 months — 180 days’ interest
    • 36 to 120 months — 364 days’ interest

This account is a great option if you don’t have a large chunk of cash laying around to set aside for savings. It’s also great if you’re looking to earn a guaranteed rate of return, though the promo rates for the savings account is higher than some of the CD terms.

Interest you earn is compounded daily and credited to your account monthly, according to a bank representative. You may qualify for higher rates if you maintain at least $5,000 in combined checking, savings or money market accounts, though you’ll need to contact the bank directly.

Upon maturity, you have a 10-day grace period to make changes, or else it’ll automatically be renewed for the same term.

However, the following terms do have exceptions:

  • A 13 month term will be renewed to a 12 month term
  • A 19 month term will be renewed to a 18 month term
  • A 25 month term will be renewed to a 24 month term

How to get Flagstar Bank’s CDs

You’ll need to head to a local branch to open a CD account. You’ll mostly likely need to bring a government-issued ID, your Social Security number and a way to fund the account.

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on Flagstar Bank’s secure website

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How Flagstar Bank’s CD rates compare

Sadly, the rates for Flagstar Bank’s CDs are much lower than other competitors on our list of the best CD rates. It does offer a pretty low minimum opening deposit, but so do many other ones. If you don’t have a large amount of cash to spare, then these CDs could work, but only if you’re close to a local branch.

Flagstar Bank money market account options

SimplyMoney Market

The rates are pretty miniscule but the account does come with check-writing capabilities.
APYMinimum Balance to Earn APY
0.05%$0.01
0.10%$5,000
0.10%$10,000
0.10%$25,000
0.10%$50,000
0.10%$100,000
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: $10
  • ATM fee: $2.50 for out-of-network ATMs
  • ATM fee refund: None, per bank representative
  • Overdraft fee: N/A

The money market account is best for those who want a hybrid checking and savings account, though the rates aren’t as good as the savings promo rate. You get ATM access and check-writing capabilities, though you are allowed up to six certain debits a month because of Regulation D. If you go over that, you’ll be charged a $10 excessive transaction fee from the bank.

You also get online, telephone and mobile banking with the account. If you have at least $5,000 across your checking, savings and money market accounts, you can get preferred CD rates, though you’ll need to contact Flagstar Bank to find out what they are. There’s also a possible 0.50% rate reduction on home equity lines of credit or personal loans if you use autopay from this money market account.

To waive the monthly fee, you’ll need to either maintain a $5,000 minimum average daily balance or have an open Flagstar Bank personal checking account.

How to get the SimplyMoney Market account

Head to your local branch to open a money market account.

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on Flagstar Bank’s secure website

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How Flagstar Bank’s money market accounts compare

We’re not impressed with these money market rates as there are much higher ones out there. Some of their competitors also have limited check-writing capabilities and no minimum balance requirements.

In other words, you’re better off doing some comparison shopping from our list of the best money market rates or considering Flagstar Bank’s savings accounts.

Flagstar Bank IRA account options

IRA CD rates

IRA CD

The annual fee is a bit of a turnoff.
  • Minimum opening deposit: $500
  • Minimum balance amount to earn APY: $500
  • Early withdrawal penalty: Depends on length of term:
    • 30 to 179 days — 30 days’ interest
    • 180 to 364 days — 90 days’ interest
    • 12 to 35 months — 180 days’ interest
    • 36 to 120 months — 364 days’ interest

The IRA CD account is best for those who want to start small with their retirement savings and prefer a more conservative investment vehicle. Any interest you earn is compounded daily and deposited into your account each month. Unlike the regular CD, there is a $5 annual fee which covers all your accounts under the retirement plan.

When your CD matures, you can make changes such as withdraw cash, make additional deposits or renew for another term within the 10-day grace period. Otherwise, it’ll automatically be renewed, with the exception of the following terms:

  • 13 months — renews to 12 month term
  • 19 months — renews to a 18 month term
  • 25 months — renews to a 24 month term

How to get Flagstar Bank’s IRA CDs

Like the other accounts so far, you’ll need to head to the nearest branch to open an account.

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on Flagstar Bank’s secure website

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How Flagstar Bank’s IRA CD rates compare

We want to give this IRA CD a chance, but the rates fall short compared with other places. Many other places on our list of the best IRA CD rates also offer a low minimum opening deposit amount and a wide range of terms, ranging from three months to five years — Flagstar Bank offers rates less than half of their competitors. Plus, you need to open an account in person, which is pretty limiting if you don’t live anywhere near a Flagstar Bank branch.

In short, you’re better off looking elsewhere.

IRA savings account

You can get the annual fee waived upon request.
  • Minimum opening deposit: $500
  • Minimum balance to earn APY: None, per bank representative
  • Annual account maintenance fee: $5 (covers all IRA accounts)
  • ATM fee: N/A
  • ATM fee refund: N/A
  • Overdraft fee: N/A

The IRA savings account is great for those who want the option to deposit and withdraw cash without many restrictions — there is still the limit of six debits a month as mandated by Regulation D, or else you face a $10 excessive withdrawal fee from the bank.

The annual fee can be waived, but you’ll need to make that request, according to a bank representative.

How to get Flagstar Bank’s IRA savings account

Head to the nearest branch to open an IRA savings account.

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on Flagstar Bank’s secure website

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Overall review of Flagstar Bank’s banking products

From what we’ve been able to find, the rates offered at Flagstar Bank aren’t that great apart from their promo rates. In addition, their CD and savings accounts offer rates that require a pretty low opening deposit. The promo rates for the savings account (except for SimplyKids) are pretty high, falling slightly lower than their competitors. Those who don’t have a lot of cash laying around will like the fact that you can open most accounts with no minimum opening deposit requirements.

However, the downfall of Flagstar Bank is that it is primarily a brick-and-mortar bank, meaning you can only open an bank account in person at any one of their California and Michigan locations. Hopefully that may change in the future, but for now, if you don’t live near a branch, you’ll have to go elsewhere.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Sarah Li Cain
Sarah Li Cain |

Sarah Li Cain is a writer at MagnifyMoney. You can email Sarah Li here

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Reviews

Review of Edward Jones CD Rates

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

What are brokered CDs?

Edward Jones offers brokered CDs, which are a bit different from the standard bank-issued CDs that most investors are familiar with. Bank-issued CDs, as the name implies, are issued by individual banks for their customers. Since Edward Jones is a broker and not a bank, it cannot issue its own CDs. Instead, the firm offers a range of CDs issued by other banks and thrifts but sold via Edward Jones.

For the casual investor, it can be hard at first glance to tell the difference between bank-issued and brokered CDs. However, there are some important distinctions:

  • No early withdrawal penalties: Brokered CDs don’t have early withdrawal penalties. If you need to get out of your CD, you can usually sell it back to another investor through a brokerage firm. This means that brokered CDs carry some additional risk, as the price of these CDs may fluctuate on the open market.
  • Higher APYs: You can often get higher yields on a brokered CD than with a bank-issued CD. Brokers are able to negotiate higher CD rates since they can guarantee a large pool of buyers to CD issuers. In the era of online banking, however, even brokered CDs do not always garner the absolute highest rates.
  • Longer-term options: Brokered CDs often have longer-term options than are available with traditional bank-issued CDs, which are generally short-term investments only.

CD rates from Edward Jones

Edward Jones offers a fairly comprehensive range of CD maturities, ranging from three months to 10 years, although the firm doesn’t offer 6-year CDs, 8-year CDs or 9-year CDs. Rates and availability change frequently, oftentimes daily. The longer-duration CDs offered by the firm aren’t traditionally available at banks.
Edward Jones CD Rates
TermMinimum deposit to earn APYAPY
3 months$1,0001.95%
6 months$1,0002.00%
9 months$1,0002.00%
1 year$1,0001.95%
18 months$1,0001.90%
2 years$1,0002.05%
3 years$1,0002.15%
5 years$1,0002.20%
7 years$1,0002.45%
10 years$1,0002.60%

For all maturities, Edward Jones requires a $1,000 opening deposit, which is the same minimum required to earn the stated APY. As these are brokered CDs, there is no early withdrawal penalty. However, investors are subject to current market prices if they need to get out of a CD prematurely. If interest rates have risen since the date of purchase, you’re likely to get less money back than you originally invested in the CD.

One important difference between Edward Jones CDs and standard bank-issued CDs is that interest does not compound with Edward Jones CDs. All interest is paid directly into a money market or insured bank deposit at Edward Jones, unless you request it to be distributed. Either way, you can’t reinvest your distributions into your existing CD.

Unlike some banks, Edward Jones doesn’t offer any type of hybrid or alternative CD, such as a step-up CD or an adjustable-rate CD. There are also no bonus APR CDs available at the current time, just standard rates. Edward Jones also does not offer special rates for jumbo CDs, which traditionally require a $100,000 deposit. However, you can use the firm’s wide range of CD maturities for certain CD strategies, such as building a CD ladder. You can also buy their brokered CDs in an IRA.

Unlike bank-issued CDs, the brokered CDs offered by Edwards Jones do not automatically roll over into new CDs. At maturity, the banks that issued the CDs pay the proceeds to Edward Jones, which then forwards the money to your account. At that point, you can either select a new brokered CD to purchase, or keep the funds in your Edward Jones money market or insured bank deposit account.

How to get CDs from Edward Jones

You’ll need to open a brokerage account at Edward Jones to buy any CDs. The account minimum to open is $0, but as Edward Jones is a full-service brokerage, you’ll need to go into a branch and visit a financial advisor to open an account. There is no facility to open an account online.

You can open your Edward Jones account as rapidly as you can fill out the paperwork and fund the account. As soon as your deposit clears, you are free to buy a CD through your Edward Jones broker. If you change your mind, you can generally withdraw your funds within 4-6 business days after deposit, although this hold period may extend to 11 business days for new clients. Once you buy a CD, you can sell it at any time on the open market. As noted above, the amount you receive may be less than the amount you originally paid.

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How do CD rates from Edward Jones compare?

Edward Jones CD rates are well above the national average, but they still fall considerably short when compared with the best available rates nationwide.

Unlike with many firms, Edward Jones doesn’t currently have any special-rate CDs, where certain maturities pay dramatically higher rates. Instead, rates at Edward Jones land along a traditional curve, gradually increasing in yield as maturities lengthen.

For example, as of July 3, 2019, the Edward Jones 2-year CD rate of 2.05% is far below the best available 2-year CD rates. Three-year CD rates top out nationally at 3.00%, but Edward Jones pays 2.15%. The pattern continues throughout the maturity curve, with the top 5-year CD rates nationally hitting 3.00% or more, while the 5-year at Edward Jones pays 2.20%.

As such, all rates at Edward Jones fall in the general area of being well-above national averages but still notably short of the best available rates.

Overall review of CDs from Edward Jones

You won’t be wasting your time investing in CDs from Edward Jones, as you’ll be earning rates far above the national averages. You’ll also benefit from the ability to construct a CD or overall investment strategy with the assistance of a full-service advisor. However, if you’re looking for the absolute best CD rates for your money, there are plenty of online banks that can pay you a higher rate.

CD investors who like a wide range of products may be disappointed at Edward Jones, as popular options such as step-up or no-penalty CDs are not currently available. However, Edward Jones CDs do benefit from offering brokered CDs. This provides a range of flexibility that standard bank-issued CDs cannot offer, as you can liquidate your CD position at any time without paying an early withdrawal penalty.

The bottom line is that yield-hungry investors that enjoy managing their own portfolios may be better suited at any number of online competitors. Those looking to incorporate decent-yielding CDs into their overall investment portfolio with the help of a full-service broker might prefer working with Edward Jones.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

John Csiszar
John Csiszar |

John Csiszar is a writer at MagnifyMoney. You can email John here

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Reviews

Wealthfront Cash Account Review

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.

Fintech startups are challenging incumbents in every corner of the financial services industry. Robo-advisor Wealthfront is part of this trend, one of many new investing apps that also offer cash management accounts with high APYs and a mix of features offered by traditional bank accounts.

Cash management accounts combine features like easy access to your money and a decent interest rate, typically found separately in checking accounts and savings accounts, respectively.  Wealthfront admits that its Cash Account won’t replace your checking account, instead touting it as a place to stash your emergency savings or achieve other savings goals and enjoy a high 2.57% APY, all with the FDIC protections of a traditional bank account.

Wealthfront Cash Account Pros

Wealthfront Cash Account Cons

  • Offers a high APY compared to other online savings accounts
  • Charges zero fees, $1 minimum balance requirement
  • Deposits are covered by FDIC insurance up to $1 million
  • Ability transfer funds from Cash Account into Wealthfront's taxable investment account.
  • Takes 1-3 business days to access your funds
  • You cannot make payments from the account

Let’s take a closer look at how Wealthfront’s Cash Account compares to both traditional bank savings accounts, and similar cash management offerings from other fintech startups, so you can determine whether it’s right for your savings.

Wealthfront Cash Account vs. online savings accounts

Wealthfront markets its Cash Account as a place to deposit savings you plan on spending in the next five years, or as a good place for an emergency fund. For longer-term returns on your money, Wealthfront advocates investing in the stock market using its core robo-advisor functionality. As an additional incentive to do so, Wealthfront allows you to transfer money from your Cash Account into one of the company’s taxable investment accounts. However, there is nothing in Wealthfront‘s terms of service that would discourage you from treating this account like any other online savings account.

Here’s how Wealthfront’s Cash Account stacks up against the highest-earning online savings accounts from our best online savings accounts review:

Financial InstitutionAPYMinimum balance
Wealthfront

2.57%

$1 minimum, no monthly fee
Vio Bank

2.52%

$100 minimum, no monthly fee
Customers Bank

2.50%

$25,000 minimum, no monthly fee
Barclays

2.20%

None
Marcus by Goldman Sachs

2.15%

$1 minimum, no monthly fee
Ally

2.10%

None

Judged by APY alone, Wealthfront‘s Cash Account emerges as one of the strongest contenders out there, surpassed only by Vio Bank’s online savings account. Like many online savings accounts, there’s a limit to the liquidity of the money placed in Wealthfront‘s Cash Account.

However, there is no option to withdraw funds or make payments from the account via check or ATM card. Your only way to get money into and out of the account is via ACH transfers to and from a separate checking account that’s held in your name. Transfers take one to three business days, and Wealthfront permits an unlimited number of transfers into and out of your Cash Account (with a daily limit of $250,000).

Wealthfront is not a bank, so it has deals with a network of regional banks that are FDIC insured. After you deposit your money in a Cash Account, your funds are swept into multiple accounts with Wealthfront’s bank partners, giving you FDIC insurance coverage up to $1 million (or $2 million if you have a joint Cash Account). This a big advantage that makes the Cash Account an attractive choice for anyone who wants FDIC coverage beyond the $250,000 limit available with a single online savings account.

Wealthfront Cash Account vs. robo-advisor cash management accounts

Many other robo-advisor firms offer cash management accounts. These accounts take varying forms: Some resemble a personal savings account, others have both savings and checking account features, while some are a type of investment account. Below we compare the Wealthfront Cash Account with cash management offerings from robo-advisors Betterment and SoFi.

Account nameFunctionFeesYield
Wealthfront Cash Account

FDIC-insured savings account

None

2.57% APY

Betterment Smart Saver

Low-risk bond investments

0.25% annual fee

2.14% APY

SoFi Money

FDIC-insured checking/savings hybrid account

None

An average of 2.25% APY

Wealthfront Cash Account vs. Betterment Smart Saver

Betterment‘s Smart Saver account is a low-risk investment account, not a deposit account, so it plays by a different set of rules than Wealthfront‘s Cash Account. For one, as an investment it does not have FDIC coverage. Betterment‘s website claims you could earn returns of 2.14% (which factors in the standard 0.25% Betterment charges for its services) — notice the word “could.” Money placed in the Smart Saver account is invested in a mix of treasuries and corporate bonds—fairly safe investment vehicles—but it still can’t guarantee the 2.14% return in the same way a deposit account can guarantee an APY.

The Smart Saver account does have some bells and whistles that may make it an appealing choice for your savings. These include:

  • Smart Sweep: This feature aims to maximize your investing returns by only maintaining as much cash in your linked checking account as you need for day-to-day spending. It works like this: After giving  access to your checking account, the app analyses how you spend money. Then it sweeps money above and beyond what you need to pay 35 days of expenses — up to $5,000 per sweep — into the Smart Saver investment account. Likewise, if the app thinks you’ll need more money to cover your expenses, it will sweep money from the Smart Saver investment account into your checking account. You can read more details here.
  • Tax relief: While you can’t avoid paying taxes entirely, the fact that 80% of the money placed in the Smart Saver investment account will be invested in U.S. Treasury bonds means that some of the earnings from the Smart Saver account won’t be subject to state and local taxes. You can read more details here.

Like Wealthfront’s account, there is an inconvenient waiting period to withdraw money from the account — four to five business days, which is longer than Wealthfront‘s one to three business days. This longer period accounts for the fact that your money is invested in bonds, making it less liquid than funds placed with Wealthfront in FDIC-insured deposit accounts.

Wealthfront Cash Account vs. SoFi Money

SoFi Money is a checking and savings hybrid account, meaning you earn both a high yield — 2.25% APY vs. Wealthfront‘s 2.57% APY — and enjoy instant access to your money with a debit card and paper checks.

Similarly to Wealthfront, SoFi Money spreads any funds you deposit across multiple FDIC-insured bank accounts — six in this case — providing up to $1.5 million in FDIC insurance vs. Wealthfront‘s $1 million.

SoFi Money may lag behind Wealthfront in terms of APY, but it makes up for this by providing the utility of both a savings and checking account. You can use your debit card to make purchases and withdraw money from ATMs (there is a daily limit of $610) just like you would with any other checking account. You can read more details on SoFi Money in our review.

Who should get a Wealthfront Cash Account?

If you’re looking for an FDIC insured account that provides one of the highest APY’s available, than the Wealthfront Cash Account may be right for you. However, you won’t have easy access to your funds like you would with a hybrid checking/savings account, such as SoFi Money. However the simplicity of the account, and the promise of additional features in the future such as a debit card and ATM withdrawals, could make it a compelling option for your savings.

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James Ellis
James Ellis |

James Ellis is a writer at MagnifyMoney. You can email James here