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INOVA Federal Credit Union 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.

INOVA Federal Credit Union checking account options

Shield Checking

An account that goes the extra mile on personal security and allows you to earn high dividends to boot.
APYMinimum Balance Amount to Earn APY
3.00%
$15,000
  • Minimum opening deposit: $10
  • Monthly account maintenance fee: $5
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

This account is loaded with perks and is a great option to earn high interest if you’re able to maintain a balance of $15,000. If you’re able to do that with no problem, the $5 monthly maintenance fee is likely negligible.

As an added bonus, this account comes with IDProtect®, an identity theft monitoring service that includes up to $10,000 in identity theft reimbursement coverage in the event that your identity is stolen. There’s also a cell phone protection feature when you pay your monthly bill through this account.

Other perks include unlimited check writing with no fees, a free Visa debit card and online banking services. You’ll also receive a thank-you gift when you open this account. Finally, INOVA Federal Credit Union will buy back your unused checks and debit card from another bank for up to $10.

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Simply Free Checking

A basic, non-interest earning account with minimal requirements.
  • Minimum opening deposit: $10
  • Monthly account maintenance fee: None
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

Although this account doesn’t have the ability to earn interest, it could be a good option for members who want a simple checking account without having to worry about hidden fees or balance requirements. Like the Shield Checking account, this free account also comes with a thank-you gift at opening, the opportunity to sell the credit union your old checks and debit cards for $10, as well as unlimited check writing, online banking services and a free Visa debit card.

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Performance Checking

A interest-earning checking account with minimal requirements.
APYMinimum Balance Amount to Earn APY
0.07%
$0.01
  • Minimum opening deposit: $10
  • Monthly account maintenance fee: $0.01
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

If you can’t meet the high minimum balance requirement to earn the APY on the Shield Checking account, this checking account is the one to get. It doesn’t have a monthly service charge or a minimum balance requirement to earn interest; all you have to do is make sure you have one direct deposit or make one automatic payment each month.

In addition to online banking services and a free Visa debit card, this account also offers unlimited check writing capabilities with no fees, a free thank-you gift at opening and the option to sell the credit union your old checks and debit cards from your previous bank.

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Advantage 50 Checking

A checking account exclusively for credit union members age 50 or older.
APYMinimum Balance Amount to Earn APY
0.07%
$0.01
  • Minimum opening deposit: $10
  • Monthly account maintenance fee: $0.01
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

Although this account is available exclusively to credit union members age 50 and over, its offerings, fees and other details are mostly the same as with the Performance Checking account, down to to the APY.

As with the Performance Checking account, you do have to make sure you have one direct deposit or make one automatic payment per month with this account. The only added perk with this account is that you can get 50 free personalized checks at any given time, while the Performance account has a fee for the checks.

This account also doesn’t have a monthly fee or minimum balance requirement. It comes with online banking services, a free Visa debit card, unlimited check writing with no fee, as well as a thank-you gift at opening and the option to sell the credit union your old checks and debit card from your previous bank.

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Elite Checking

Tiered dividend levels makes this checking account ideal for those able to maintain higher balances.
APYMinimum Balance Amount to Earn APY
0.11%
$0.01-$1,999.99
0.25%
$2,000
  • Minimum opening deposit: $10
  • Monthly account maintenance fee: $7.50 (can be waived with a maintained balance of $2,000 or more)
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

Like the Shield Checking account, this account is also more suited for those who can maintain higher account balances. However, its minimum balance requirement to earn a higher APY is much lower than the other account. This account does have a low monthly fee, but you have the ability to waive it if you maintain a balance of at least $2,000, the same balance you need to be able to earn that higher rate. It also comes with online banking capabilities, a free Visa debit card and free personalized checks, along with a thank you gift at its opening and the chance to sell the credit union your old checks and debit card from your previous bank.

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How INOVA Federal Credit Union’s checking accounts compare

If you’re able to maintain the minimum balance requirements on INOVA Federal Credit Union’s Shield and Elite checking accounts, you’ll have the opportunity to earn a great APY rate. However, despite the lack of fees and requirements for the credit union’s more basic accounts, when you take a look at the rates, they just don’t compare to some of the best checking account options out there. The bonuses like thank-you gifts and check buyback are a nice touch, but don’t do much in the long term.

INOVA Federal Credit Union savings account options

Membership Savings

Anyone joining the credit union is required to opening this account.
APYMinimum Balance Amount to Earn APY
0.01%
$100
  • Minimum opening deposit: $5, plus a one-time $10 membership fee
  • Minimum balance to earn APY: $100
  • Monthly account maintenance fee: None
  • ATM fee: None
  • ATM fee refund: $29

Opening this savings account is a requirement to join INOVA Federal Credit Union and open any of its other products. That’s not really such a bad thing, though, as it only requires a $5 deposit to open and has no monthly fee. It doesn’t really come with any added perks, though, aside from online banking capabilities. And, like all savings accounts, this account is subject to Federal Reserve Regulation D, which limits certain withdrawals up to six per month.

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Special Savings

A simple savings account that allows you to save for a goal with no requirements.
APYMinimum Balance Amount to Earn APY
0.01%
$0.01
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: None
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

If you’ve got funds you want to stash aside for, say, a new car or vacation, this account is a great way to do it while earning interest. This account comes with no monthly fees or minimum balance requirements and has online banking capabilities. As with other savings accounts, it’s subject to Regulation D, which limits certain withdrawals up to six per month.

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Christmas Club

A savings account specifically for holiday-related expenses.
APYMinimum Balance Amount to Earn APY
0.01%
$0.01
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

This account is similar to the Special Savings account; the key difference is that it’s specifically intended for holiday-related expenses. This interest-earning account doesn’t have any monthly fees or minimum balance or deposit requirements. You can make deposits at any time up until Oct. 31 of a given year before funds are transferred to your Member Savings account.

Keep in mind that this account does have an early withdrawal fee of $10 if you dip into it before Nov. 1. And as with other savings accounts, this account is subject to Federal Reserve Regulation D, limiting certain withdrawals up to six per month.

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How INOVA Federal Credit Union’s savings accounts compare

None of INOVA Federal Credit Union’s savings accounts offer spectacular rates, so we wouldn’t recommend joining the credit union for a savings account alone — though it is a requirement to open any other product. While we like the idea behind the Special Savings and Christmas Club accounts, they offer the same APY as the required Members Savings account, so it seems a little redundant to open both. If you’re simply in search of a savings account with great rates, we suggest looking elsewhere, as there are much better savings account options to be had out there.

INOVA Federal Credit Union certificate rates

Certificates

These offerings give you the opportunity to earn higher rates than with a savings account.
TermAPYMinimum Balance Requirement to Earn APY
30 day0.35%
$200
60 day0.35%
$200
91 day0.35%
$200
5 month0.75%
$200
6 month0.75%
$200
7 month0.85%
$200
14 month1.25%
$200
14 month3.00%
($50,000 or more of new money)
18 month1.50%
$200
30 month2.50%
$200
30 month3.25%
($50,000 or more of new money)
1 year1.00%
$200
2 year1.85%
$200
3 year2.50%
$200
4 year2.75%
$200
5 year3.00%
$200
6 year3.25%
$200
  • Minimum opening deposit: $200
  • Minimum balance amount to earn APY: Varies
  • Early withdrawal penalty: Terms of less than 90 days is 30 days’ dividends; terms of 90 days to one year is 90 days’ dividends; terms of longer than 1 year is 180 days’ dividends

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Step Up Certificates

These certificates offer you a one-time chance to increase your rate.
TermAPYMinimum Balance Requirement to Earn APY
91 day0.35%
$200
6 month0.75%
$200
14 month1.25%
$200
18 month1.50%
$200
30 month2.50%
$200
1 year1.00%
$200
2 year1.85%
$200
3 year2.50%
$200
4 year2.75%
$200
5 year3.00%
$200
6 year3.25%
$200
  • Minimum opening deposit: $200
  • Minimum balance amount to earn APY: $200
  • Early withdrawal penalty: Early withdrawal penalty: Terms of less than 90 days is 30 days’ dividends; terms of 90 days to one year is 90 days’ dividends; terms of longer than 1 year is 180 days’ dividends

NOVA Federal Credit Union offers share certificates with fixed rates that are higher than its regular savings account products, and those rates get higher the longer the term you select (available terms range from 30 days to 6 years). These certificates require a minimum deposit of $200 to open, lower than many other offerings out there.

The credit union also offers flexible Step Up certificates that allow you to increase your rate once during the term if you see rates go up on its regular products. Lastly, there is a chance to earn a higher rate on the 14-month and 30-month certificates if you deposit at least $50,000 in “new money” that is not currently on deposit in any other INOVA Federal Credit Union accounts.

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How INOVA Federal Credit Union’s certificate rates compare

When you compare INOVA Federal Credit Union’s certificate rates to the best CD rates out there, you’ll see that, for the most part, these rates don’t stack up. Still, if you prefer a much smaller minimum deposit than many other options out there, then these might be a good fit for you.

Generally speaking, though, we would suggest holding out for a better rate when you have more funds to deposit, or simply opening a CD with the same term length and a higher rate from an online-only bank.

INOVA Federal Credit Union’s money market account options

Gold Money Market

An account offering a decent rate and minimal requirements, other than a high minimum deposit.
APYMinimum Balance Amount to Earn APY
1.25%
$50,000
  • Minimum opening deposit: $50,000
  • Minimum balance to earn APY: $50,000
  • Monthly account maintenance fee: None
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

This account does offer a competitive rate in exchange for a high minimum deposit requirement of $50,000. On the plus side, it doesn’t come with a monthly service charge and does have online banking capabilities. Since this is a savings account, you are allowed to make up to six certain electronic transactions per month, as per Federal Reserve Regulation D.

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Platinum Money Market

The bank’s other money market account option, offering a higher rate and an even higher minimum balance requirement.
APY`Minimum Balance Amount to Earn APY
1.50%
$100,000
  • Minimum opening deposit: $100,000
  • Minimum balance to earn APY: $100,000
  • Monthly account maintenance fee: None
  • ATM fee: None from INOVA FCU ATM, Alliance One or CO-OP Network ATM; $2 for using any other ATMs.
  • ATM fee refund: None
  • Overdraft fee: $29

This is INOVA Federal Credit Union’s other money market account option, which also offers a high APY rate with a high minimum deposit and balance requirement. As with the Gold Money Market account, this account has no monthly fee, comes with online banking services, and limits you up to six certain transactions per month, as per Federal Reserve Regulation D.

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How INOVA Federal Credit Union’s money market accounts compare

INOVA Federal Credit Union’s money market account rates are on par with some of the best money market accounts out there. The main difference is that most others don’t require such a high minimum opening deposit and minimum balance requirement, which can be a limiting factor for many people. If you don’t have that much cash saved up to put aside, you can easily find another option from another financial institution with just as good a rate (if not better) and more flexible requirements.

INOVA Federal Credit Union IRA Certificate options

IRA Certificates

These offer the same terms and conditions as the credit union’s regular certificates, it’s just the rates that vary.
TermAPYMinimum Balance Requirement to Earn APY
91 day0.60%
$200
6 month1.00%
$200
7 month1.10%
$200
14 month1.50%
$200
14 month3.25%
$50,000 in new money
18 month1.75%
$200
30 month2.75%
$200
30 month3.50%
$50,000 in new money
1 year1.25%
$200
2 year2.10%
$200
3 year2.75%
$200
4 year3.00%
$200
5 year3.25%
$200
6 year3.50%
$200
  • Minimum opening deposit: $200
  • Minimum balance amount to earn APY: Varies
  • Early withdrawal penalty: Terms of less than 90 days is 30 days’ dividends; terms of 90 days to year is 90 days’ dividends; terms of longer than 1 year is 180 days’ dividends

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Step Up IRA CDs

As with the regular Step Up certificates, these allow you to increase your rate once during the term.
TermAPYMinimum Balance Requirement to Earn APY
91 day0.60%
$200
6 month1.00%
$200
18 month1.75%
$200
30 month2.75%
$200
1 year1.25%
$200
2 year2.10%
$200
3 year2.75%
$200
4 year3.00%
$200
5 year3.25%
$200
6 year3.50%
$200
  • Minimum opening deposit: $200
  • Minimum balance amount to earn APY: $200
  • Early withdrawal penalty: Terms of less than 90 days is 30 days’ dividends; terms of 90 days to year is 90 days’ dividends; terms of longer than 1 year is 180 days’ dividends

Aside from the varying rates, INOVA Federal Credit Union’s IRA certificates don’t differ much from its regular certificate products. As with the regular certificates, these offer fixed rates and terms that range from 91 days to six years.

These certificates require a minimum deposit of $200 to open, which is lower than many other offerings out there. There is also the option to open flexible Step Up IRA certificates, which allow you increase your rate one time during the term if you see the rates go up on the regular certificates.

Lastly, you have the opportunity to earn a higher rate on the 14-month and 30-month IRA certificates if you deposit at least $50,000 in “new money,” or funds that are not currently on deposit in any other INOVA Federal Credit Union accounts.

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How INOVA Federal Credit Union’s IRA CD rates compare

There’s no getting around it — compared to the best IRA CD rates out there, INOVA Federal Credit Union’s rates are pretty low. The wide range of term lengths and the minimum required deposit might appeal to some people, but, again, we say hold off until you have a bit more cash to deposit so you can take advantage of being able to earn a much higher rate.

INOVA Federal Credit Union IRA options

IRA Savings

This IRA offers a very low rate compared to the credit union’s other offerings.
APYMinimum Balance Amount to Earn APY
0.01%
$0.01
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: None
  • ATM fee: N/A
  • ATM fee refund: N/A
  • Overdraft fee: N/A

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IRA Money Market Savings

A slightly better rate than the traditional IRA savings account, but still not the best out there.
APYMinimum Balance Amount to Earn APY
0.05%
$0.01
  • Minimum opening deposit: None
  • Minimum balance to earn APY: $0.01
  • Monthly account maintenance fee: None
  • ATM fee: N/A
  • ATM fee refund: N/A
  • Overdraft fee: N/A

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IRA Financial Management Account

This account allows you to earn higher dividends with higher balances.
APYMinimum Balance Amount
0.01%
$0.00 (up to $10,000)
0.10%
$10,000.01 to $25,000
0.20%
$25,000.01 to $50,000
0.35%
$50,000 to $100,000
0.40%
$100,000.01
  • Minimum opening deposit: $2,000
  • Minimum balance to earn APY: $0.00
  • Monthly account maintenance fee: None
  • ATM fee: N/A
  • ATM fee refund: N/A
  • Overdraft fee: N/A

INOVA Federal Credit Union’s regular IRA savings accounts currently offer the same rates as its regular savings account, with no opening, monthly or yearly fees to boot. Its IRA Money Market Savings and IRA Financial Management Accounts, meanwhile, offer higher rates, especially if you make a larger deposit into the latter account.

While there is no minimum deposit or balance requirement on any of these accounts, you can only contribute up to $5,500 per year, with an additional $1,000 “catch up” deposit allowed for account holders ages 50 and over. Some differences between the traditional and Roth IRAs are:
The traditional has no income limits to open, while the Roth does; and, the earnings on the Roth IRA are 100% tax-free at withdrawal, while the traditional account’s earnings are not. Both accounts allow withdrawals to begin at age 59½, although the traditional IRA requires you to begin making withdrawals by age 70½, while the Roth has no limits on making contributions as long as you’re still earning income.

Early withdrawals on all accounts are subject to a penalty and possible taxes, although certain instances such as healthcare expenses and buying a first home qualify as exceptions. Penalty amounts vary depending on how much you have in the account and how long it’s been open. All accounts are subject to Federal Reserve Regulation D, which limits certain transfers and transactions up to six per month.

How to get INOVA Federal Credit Union’s banking products

If you are over 18 years of age and meet one of the eligibility requirements, you can easily apply for membership at INOVA Federal Credit Union and open any of the above mentioned products online, once you agree to also open a Membership Savings account. You’ll need to provide personal information such as your name, address, Social Security number, government-issued ID number (e.g., drivers license or passport), as well as a debit or credit card or check from another financial institution to fund the account. You can also open an account at one of the credit union’s seven branch locations, or by calling 800-826-5465.

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How INOVA Federal Credit Union’s IRA rates compare

Of INOVA’s IRA three account options, it’s the IRA Financial Management Account that shines, even with its higher balance requirements to earn higher dividends. As with the credit union’s IRA CD rates, the wide range of term lengths and the minimum required deposit might appeal to some people.

Overall review of INOVA Federal Credit Union banking products

Most of INOVA Federal Credit Union’s personal banking products offer rates far below similar products at other institutions. The more flexible minimum balance and deposit requirements on the certificates might appeal to some people, but we would still advise you to do your research and hold out for better offerings. Meanwhile, the rates on its money market accounts are definitely competitive, but the high deposit and balance requirements could be a limiting factor to many people.

All in all, we would say take the time to comparison shop to make sure you get the best rate out there while still reaping the benefits of minimal fees and flexible requirements.

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.

Emilia Benton
Emilia Benton |

Emilia Benton is a writer at MagnifyMoney. You can email Emilia 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

2.10%

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