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Zelle Is Big Banks’ Response to Venmo — Here’s How it Stacks Up

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.

Perhaps you’ve heard of Venmo, a PayPal-owned social payments platform that caught like wildfire among millennials, and serves as a popular way for people to split the bill. The digital peer-to-peer (P2P) payment service is ubiquitous to the point of being a verb — “Venmo me” — but that’s not stopping the big banks from making a play for the market.

In 2017, the banks responded with Zelle, a P2P transaction platform that can process payments between accounts at different banks within minutes, for free. When using apps like Venmo, PayPal and Square Cash, consumers may have to wait up to two or three days to access deposits in their bank accounts or pay a fee for instant access.

What is Zelle?

Zelle is a peer-to-peer payment service created by Early Warning Services, a company owned by Bank of America, BB&T, Capital One, JPMorgan Chase, PNC Bank, U.S. Bank and Wells Fargo. Zelle users can send, receive or request money directly to and from friends’ and family members’ bank accounts using only an email address or phone number, even if the other party has an account with a different bank. Zelle claims to process payments between accounts at different banks within minutes, for free.

As of this writing, Zelle partners with more than 65 banks and is accessible to more than 85 million U.S. consumers through its partners’ mobile banking applications. If your bank isn’t partnered with Zelle, you can still create an account using the Zelle app to send, receive and request money much like other P2P payment services.

Zelle, formerly known as ClearXchange, has grown rapidly since it’s rebranding and rollout to banking applications in 2017. It’s now a serious competitor in the P2P space. Early Warning reported the payments company processed $75 billion in payments in 2017. Meanwhile, its main competitor, Venmo, processed more than $40 billion in payments on its free mobile app in the 12-month period ending March 31, 2018. Early Warning said Zelle processed more than $25 billion in the first quarter of 2018, and Venmo processed $12 billion in the same period.

Is Zelle safe to use?

Zelle is advertised as a service for sending money to friends, family and people you know personally. The company does not offer a protection program for purchases or sales made through its platform, and neither do its participating financial institutions.

If you initiate the transfer, you are not covered for fraud by Zelle or your bank. For example, if you send someone money for event tickets using Zelle and it turns out the tickets are fake, there is no recourse against the person via Zelle or your bank, and you will lose your money like this woman did.

However, consumers are not liable for “unauthorized activity,” like if someone else uses Zelle to hack into your bank account. Zelle provides fraud protections as required by the Federal Reserve’s Regulation E.

How to avoid the biggest risks of using Zelle

Know the recipient personally
Sending money on Zelle is akin to handing cash to someone. To avoid losing your money to a fraudster, ensure you are only sending money to people you know and trust.

Confirm the recipient’s information
Zelle transactions cannot be disputed or reversed, so you want to double-check with the recipient that you’re using the correct email address or phone number. If you initiate a transaction to the wrong person, Zelle has no obligation to help you get your money back.

Enroll with only one bank
To avoid delays in sending and receiving funds using Zelle, make sure the email and/or phone number you want to use is only enrolled at one bank or credit union, and that it matches what the bank has on file.

If the same phone number and/or email is registered with your Zelle profile at more than one institution, you may run into issues sending and receiving payments using this service. Money sent to you using the phone number or email address you provide friends and family may be sent to the wrong bank account or to an old Zelle account. The funds may also get held up until you sort out the mix-up.

If you were previously enrolled in ClearXchange or the Zelle app before your bank integrated Zelle into its banking app, you may already have an active Zelle account using your phone number and/or email. If you want to enroll in Zelle with your bank, you’ll first need to contact customer support team and deactivate your old account there.

How does Zelle work?

Zelle plays up its ease of use: Because it’s integrated into mobile banking apps, customers of banks using Zelle can use a single app to schedule bill pay, make deposits and complete fee-free P2P transactions. That means users don’t have to download an extra app to use Zelle on a mobile device, unlike stand-alone apps like Venmo and PayPal. Zelle does, however, have a stand-alone app, if you’d prefer to use that.

Zelle withdraws money directly from the sender’s bank account and deposits it directly into the recipient’s bank account. Users can send, request or receive money using an enrolled email address or mobile phone number.

How to send money with Zelle

On your mobile banking app
Zelle works a little differently on each of its partners’ mobile banking apps, but the main steps to send money are the same.

You’ll first select a recipient from (either from your contacts list or by adding them manually) and whether you’re sending money to them using their phone number or email address. Then, you enter the amount you want to send. At that point, you may have the option to set a sending date and add an optional note. Then, hit send. Your recipient should get a notification and see the funds in their bank account within minutes.

Here are some examples of how this service has been integrated into mobile banking:

Send money on Chase mobile app

Source: JPMorgan Chase

Send money on Bank of America mobile app

Source: Bank of America

Split expenses with Zelle on Bank of America mobile app

Source: Bank of America

Sending money on the Zelle app

To reach customers whose banks aren’t part of the Zelle network, Early Warning partnered with Mastercard and Visa to make a Zelle app that allows transfers to those at nonparticipating banks and just about everyone with a U.S.-based debit card. However, at least one person involved in a Zelle transaction must have access to it through their bank or credit union.

Sending money on the Zelle app is similar to using other P2P apps like Venmo.

  1. Select someone to send money.
  2. Enter the amount of money you want to send and hit “review.”
  3. Confirm the amount you’re sending, and enter an optional message to the recipient.
  4. Hit send. The transaction is recorded and the recipient will get a notification that you’ve sent them money.
Source: iTunes

How to receive money with Zelle

When someone sends you money using Zelle, the funds should show up in your bank account within a few minutes, unless it’s your first time using this service.

If you’re not already enrolled with Zelle, you should get an email or text saying someone sent you money using Zelle. You’ll then need to follow the enrollment instructions to get set up with the service. After you’re enrolled, it may take up to three days to receive the money in the bank account associated with your profile.

How long does it take to send and receive money with Zelle?

Zelle transfers money directly between U.S. bank accounts. Transfers occur typically within minutes, unless the recipient is not already enrolled in Zelle. If the recipient is not yet enrolled, it may take up to three business days for the money to become available in their bank account.

Is there a limit to how much money you can send and receive with Zelle?

There are no limits to the amount of money you can receive, but there may be limits on how much money you can send, depending on your bank and the type of account you’re using. Zelle recommends you contact your bank or credit union to learn about any sending limits.

For example, Chase caps transfers from personal checking accounts at $2,000 per transaction, and customers can send up to $2,000 a day and $16,000 in a calendar month. However, customers sending money from a Chase Private Client or Private Banking client account can send up to $5,000 per day and $40,000 per calendar month.

If your institution doesn’t offer Zelle and you use the Zelle app, Zelle bases your weekly send limit on your track record using the app.

Are there any fees to use Zelle?

There are no fees to use the service. The company recommended you confirm with your bank or credit union that there are no additional fees.

Are there any other limitations to Zelle?

No credit card transactions: You won’t be able to send money using a credit card at all; you can for a 3% fee on Venmo.

No international transfers: As of this writing, Zelle’s system doesn’t support international payments. The service only works with U.S.-based bank accounts, so you won’t be able to send money directly to family abroad. However, if you are traveling and have access to your bank account overseas, you can receive transfers made to your U.S.-based bank account.

Zelle vs. other person-to-person payment systems

By leveraging its network of bank partnerships, Zelle claimed consumers should be able to make transactions between different institutions within minutes. However, if your recipient does not have access to Zelle through their bank or credit union, or their partnered bank does not yet support real-time payments, Zelle loses its advantage. Transactions would then take between one and three days to complete, no better than the likes of PayPal or Venmo.

When you send money to a friend using Venmo, they instantly receive that amount as their Venmo balance, but then need to initiate a bank transfer to access the funds. The same goes for PayPal and Square Cash. With Popmoney, a service that sends money directly between bank accounts, there’s no need to initiate a deposit, but it takes a couple of days for the transactions to clear. With these services, it can take one to three days for a deposit to become available in your bank account.

What you need to know about instant transfers

Though Zelle touts transaction speed as one of its greatest strengths. While the instant transfer feature made the company stand out when it first rolled out in 2017, its competitors weren’t far behind. The Cash App, by Square, Inc. offers instant access to transferred funds for a 1.5% fee of the deposit amount, PayPal and Venmo both offer instant transfers for $0.25 per transfer.

What also made Zelle stand from the crowd was its free instant transfers. But now Google Pay offers that, too. Money sent using a debit card or Google Pay balance is transferred instantly to the person’s debit account — if it’s set as their default payment method — for free.

There are several ways you can can send money to friends, family members or the person you picked up your coffee table from on Craigslist. They range from social media options like Snapcash or Facebook Messenger, to full-fledged mobile and web apps like the PayPal app or Google Wallet.

Here’s how some of the big players in the P2P payments space to compare with Zelle:

FeatureZelleVenmoPayPalSquare CashPopmoneyGoogle Pay SendFacebook Messenger
Who you can send money toAnyone whose bank offers Zelle (85 million consumers) or anyone who is set up with the Zelle appAnyone with a Venmo accountAnyone with a PayPal account (237 million customer accounts)Anyone with a Square accountAnyone at any of nearly 2,500 financial institutionsAnyone; no need to have a Google account or the Google Pay Send appAnyone with a Facebook account who is 18+ years old
Time it takes deposit to become available in recipient’s bank accountMinutes, unless the recipient’s bank doesn’t support instant transfers or isn’t a partnered institution1 to 3 business days after transferring from Venmo account to bank.

Instant transfers for a fee of $0.25 per transaction.

Transfers made before 7 p.m. EST typically arrive the following business day. Transfers made after 7 p.m. EST or on weekends or holidays will typically arrive on the second business day.

Instant transfers are available for a fee of $0.25 per transaction.

Up to 3 business days.

Instant deposits are available for a fee of 1.5% of the deposit amount.

Up to 3 business daysMoney received transfers automatically to your default payment method

Funds are available typically within minutes if a debit card is set as your default payment method

Transfers to a bank account may take up to three business days

Up to 5 business days
Has a stand-alone appYes. In addition, this service is integrated directly into existing bank mobile apps.YesYesYesNo. PopMoney is integrated into existing mobile banking appsYesYes
Has a web versionYesYesYesYesYesYesYes
FeesNoneFree to send money from a bank account or debit card

3% fee to send money from a credit card

$0.25 to make an instant transfer

Free when you send funds via a bank account

2.9% plus 30 cents (U.S.) of the amount you send using a debit or credit card

$0.25 to make an instant transfer

Free to send money from a bank account or debit card.

3% fee to send money from a credit card

Free to receive money or pay a request
$0.95 to send or request funds
Accepts credit card transactionsNoYesYesYesNoNoNo
Transaction limitsNone, but your bank may impose transfer limitsSend up to $2,999.99 per 7 days after identity verification; no receiving limit.

Cash out up to up to $19,999.99 per week after identity verification.

Send and receive up to $10,000 per transactionSend up to $2,500 a week after identity verification; receive more than $1,000 per 30 days after identity verificationDaily transaction limit for a debit card: $500

Daily transaction limit for a bank account: $2,000

30-day transaction limit for a debit card: $1,000

30-day transaction limit for a bank account: $5,000

Send up to $9,999 per transaction or up to $50,000 in 5 days

If you live in Florida, you can send up to $3,000 every 24 hours

Unclear. The terms and FAQs say nothing about limits, and Facebook did not respond to our request for information. A community forum post from 2016 says you can send up to $9,999 within 30 days
Supports international transfersNoNoYes – Fees for sending in other currencies varyNoNoNoNo
Lets you store funds on an in-app accountNoYesYesYesNoYesNo
Fraud protectionNone if you, the consumer, initiated the transfer.

You are covered if someone makes an unauthorized transaction on your Zelle account if reported within 4 days after learning of the unauthorized transaction.

Venmo does not offer buyer or seller protection.

You are covered if someone uses your Venmo account to make an unauthorized transactions if reported within 60 days.

Yes: Paypal offers purchase protection to buyers and sellers of goods and services for claims reported within 180 days

Paypal covers unauthorized transactions if reported within 60 days

Paypal does not provide protections for personal transactions sending money to “friends and family.”

Sellers protection only

Square is not responsible for any unauthorized access or use of the services on your square account

Varies by stateNo protection for authorized transactions.

Google Pay offers fraud protection for all verified unauthorized transactions if reported within 120 days of the transaction date

Facebook is not liable for payments you send via Messenger

Facebook provides protection for unauthorized transactions on your account if you submit a claim within 30 days

What banks use Zelle?

Zelle partners with the following banks and credit unions, as of this writing:

  • Ally
  • America First Credit Union
  • Bank of America
  • Bank of Central Florida
  • Bank of Hawaii
  • Bank of the West
  • Bank of York
  • Bank7
  • BB&T
  • BBVA Compass
  • BECU
  • BNY Mellon
  • Capital One
  • Chase
  • Citi
  • Citizens Bank
  • City National Bank
  • Collins State Bank
  • Comerica Bank
  • ConnectOne Bank
  • Dollar Bank
  • FCB Bank
  • Fifth Third Bank
  • First National Bank
  • First National Bank in Creston
  • First National Bank of Central Texas
  • First Tech
  • First Tennessee Bank
  • FirstBank
  • Franklin Synergy Bank
  • Frost Bank
  • Guadalupe National Bank
  • Homestreet Bank
  • Huntington Bank
  • KeyBank
  • M&T Bank
  • MB Financial
  • MidwestOne Bank
  • Morgan Stanley
  • Navy Federal Credit Union
  • Northwest Bank
  • PNC
  • Provident Bank
  • Quontic Bank
  • Regions Bank
  • Renasant
  • SchoolsFirst FCU
  • Seacoast National Bank
  • Star One Credit Union
  • Stockman Bank of Montana
  • SunTrust
  • Surrey Bank & Trust
  • TBK Bank, SSB
  • TD Bank
  • The First Citizens National Bank of Upper Sandusky
  • U.S. Bank
  • United Bank
  • United Community Bank
  • USAA
  • Wells Fargo

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.

Brittney Laryea
Brittney Laryea |

Brittney Laryea is a writer at MagnifyMoney. You can email Brittney at [email protected]

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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.


on Edward Jones’s secure website

Member FDIC

magnifying glass

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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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


$1 minimum, no monthly fee
Vio Bank


$100 minimum, no monthly fee
Customers Bank


$25,000 minimum, no monthly fee


Marcus by Goldman Sachs


$1 minimum, no monthly fee



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


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


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.

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.

James Ellis
James Ellis |

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