Wealthfront Brokerage Ups Cash Account Rate to 2.57% APY


Deal Summary: 2.57% APY on balances of $1+

Availability: Nationwide.

Wealthfront Brokerage raised the APY of its cash management account, the FDIC-insured Cash Account, by 6 bps to 2.57% for all balances of $1 and above. This is now the rate leader when compared to online savings and money market accounts. It should be noted that this is not a bank account. It’s a cash management account. In this previous blog post I reviewed the question of how this account compares in safety to a standard savings account.

3.30%$1$1mWealthfrontCash Account
Rates as of December 5, 2022.

Wealthfront announced this rate increase in its blog post yesterday:

Today’s new interest rate marks the third increase since we first launched our Wealthfront Cash Account in February.

When it launched in February, it had a 2.24% APY. So the rate has always been competitive in its short life. How competitive will it stay? One thing Wealthfront admits in this blog post is that they will have to lower the rate if and when the Fed cuts the target federal funds rate:

If the rate is lowered by 0.25%, then we will have to lower the rate for our cash account by the same amount.

If they can keep the Cash Account yield at the upper range of the federal funds rate over the long run, they will be a noteworthy rate leader. They will need to be able to exceed this level if the federal funds rate goes back to near zero. During the zero-interest rate years, online savings account rates were able to exceed the upper range of the federal funds rate by 50 to 75 bps. That resulted in many online savings accounts with rates between 0.75% and 1.00% (Let’s hope we don’t go back to those days.)

In addition to a higher rate, Wealthfront is promoting their Cash Account as having two big advantages over savings accounts at banks:

  1. $1 million of FDIC insurance (standard FDIC insurance at banks is $250k)
  2. No limit on the number of withdrawals per statement period (bank savings accounts are generally limited to 6)

I have a list of additional features in my May blog post. These features still appear to be applicable today. Also, in that May blog post, I review the details of how safe the Cash Account is as compared to savings accounts.


The Wealthfront Cash Account is available nationwide. New customers can open the Cash Account without opening an Investment Account. Accounts can be opened at the Wealthfront Cash page by clicking "Get Started" and "Open a Wealthfront account."

Company Overview

One thing to note is that Wealthfront isn’t a new brokerage firm. According to this 2012 Forbes article, “WealthFront was started in 2008.” Wealthfront is listed at the Financial Industry Regulatory Authority (FINRA) BrokerCheck website. FINRA is an independent, non-governmental regulator for all securities firms doing business with the public in the U.S. According to this FINRA BrokerCheck page, Wealthfront Brokerage received SEC registration and FINRA registration in 2010. The SEC noted that according “to its Form ADV, as of August 16, 2018, Wealthfront had over $11 billion in assets under management.” Wealthfront currently lists assets under management at $13 billion.

Wealthfront received some bad publicity in December from an SEC enforcement action and fine. According to this Reuters article, an “SEC order alleged that Wealthfront, one of the largest independent robo-advisers, had made false statements about a tax-loss harvesting strategy it offered to clients.” Full details are available in this SEC enforcement action document.

How the Wealthfront Cash Account Compares

When compared to the Savings Accounts and Money Market Accounts tracked by DepositAccounts.com that are available nationwide, Wealthfront Cash Account currently ranks first, regardless of minimum balance requirements.

The above rates are accurate as of 6/27/2019.

To search for the best Savings and Money Market Account, both nationwide and state specific, please refer to DepositAccounts.com’s Savings Account Rates page and Money Market Account Rates page.

Related Pages: savings accounts, nationwide deals, Internet banks

  |     |   Comment #1
Regarding the comparison table, the 2.53% rate for Eagle Premium Savings at Susquehanna is correct, but they are no longer allowing that account to be opened online; it only can be opened in branch (central Pennsylvania).
  |     |   Comment #2
Things to be aware of at Wealthfront:
1. To satisfy anti-money laundering regulations, there is a 6 business day hold on all new deposits before your funds can be transferred out of your account.
2. There is no routing number so all ACH push and pulls must be done from Wealthfront website only.
3. Withdrawals typically take 1-3 business days to arrive at your bank. It may take longer if, for example, you recently made a deposit or if you are withdrawing to a different bank account than the one used for initial funding.
4. Currently you can't write or deposit checks, pay credit card bills, mortgage, rent, or other bills using the cash account.
deplorable 1
  |     |   Comment #5
Thank you this was the information I was looking for. If they end up allowing 3rd party ACH pulls for paying bills(which they should) I will be opening this ASAP. I was surprised that GM right notes didn't offer this capability either.
  |     |   Comment #9
Thanks for doing the leg work. Unfortunately you can't take anything for granted when you open an account. Even things that should be basic banking, are often missing. There's probably something like a hundred questions you really should ask before you open any account. if you miss even one thing, it could be the critical thing that ends up costing you a lot of money.

Generally I'm opposed to more government regulation. But the banks are so heavily regulated already, it seems they should have some kind of uniform minimum services that they need to provide in order to call themselves banks or credit unions. if not government, then they should have some kind of industry standard, so that a bank can say for example that it complies with ABC rules, where ABC is a set of minimum terms and services that a depositor can count on. If it's ABC certified you know what you're getting. I guess the problem is that there just isn't enough demand for that. Most people just don't care... Until they run into a problem.
  |     |   Comment #10
This is an offer from a brokerage. I suspect that avoiding Bank/CU regulations is precisely why so many of these offers are popping up from other financial market players. Limiting services and trying to redefine account types to fit some lucrative space that bridges FDIC and SIPC insurance coverage is becoming a common theme.
  |     |   Comment #3
the 2.57% rate seems like a great rate, but it seems like it's a done deal that interest rates are going down and therefore so will their rate. I like Northern Direct rate of 2.50 and guaranteed till the end of the year.
  |     |   Comment #4
True, rates are likely to go down in the near future across the board. With wealthfront looking to be the top dog of interest rates, even when rate drops start, it seems likely that that'll still be at the upper end of the rate game.
deplorable 1
  |     |   Comment #6
This looks like a good account if you are just looking for a FDIC insured parking place for liquid cash. If you intend to move money around often in order to pay bills, open new CD's, take advantage of bank bonuses etc. this account may not be the best option. If you are intending on using this account as a sweep account for their brokerage services however this really can't be beat. Just imagine having your dividends and stock sales moving directly to this account and ready to go for the next investing opportunity that comes up with no loss of interest in between trades.
deplorable 1
  |     |   Comment #7
I just sent them a email requesting 3rd party ACH transfer capability. I'll post back if I get a response from them. Maybe if enough people request this they will add it. Just think unlimited bill pay plus the best rate and FDIC insurance..........win, win, win.
deplorable 1
  |     |   Comment #14
I just got a response back from Wealthfront:

Thanks for the email. We're working on this feature. No specific timeline, but we're aiming for end of year at the latest. We can reach out when it's available.

So it looks like this is something they are looking at. If anyone else would like to see 3rd party ACH withdrawal capability added I would email them. As always the squeaky wheel gets the grease. This could end up being like a checking account with the interest rate of a high yield savings if they add a few more features. I see some real potential here.
  |     |   Comment #21
SoFi already has all those features, like direct deposit, ability to add them to other bank's ach systems, bill pay free checks and a debit card with worldwide unlimited atm rebates...Only thing they don't have is beneficiaries but that is expected by around September...Aside from e-mail (and they respond promptly) they have 7 day a week phone service and will soon add chat as well...and they use 6 program banks, so coverage is 1.5 million FDIC...Only thing is rate is lower, but not bad (2.25% apy)...
I suspect Wealthfront will NOT retain this higher rate, once they add additional features...
  |     |   Comment #22
I've already switched over to SoFI as i wanted a full featured account and idn't want to wait 6-9 months to get all of them...
  |     |   Comment #23
Oh, almost forgot...they have mobile check deposit also...Wealthfront doesn't have that yet...
deplorable 1
  |     |   Comment #27
@Craig: I'm not sure that bill pay would work for me as I schedule all my credit card bills weeks ahead of time to come out on the due date from each card issuers site. These all get pulled from my Ally demand note account which already pays 2.27% APY if I want to keep $50,000 in there. This way they can never say I didn't pay on time since I have a receipt with a transaction code. I don't pay my credit card bills early in order to maximize interest. It makes a difference when you are talking 20-30 bills/mo. If Wealthfront allowed this I could not only get a higher rate but pick up FDIC insurance as well. I think bill pay requires you to use THEIR website rather than each individual credit card's site which may result in late payments or paying bills way in advance of the due date.
  |     |   Comment #8
They have to do lots of changes (improvements) before they get my business.
  |     |   Comment #11
Should be interesting to see Robinhood getting there banking license in 2 or 3 years, and removing the middle men that wealthfront now has.
  |     |   Comment #12
This is the only line that concerns me in fine print at the bottom. Cash Account is offered by Wealthfront Brokerage. Neither Wealthfront Brokerage nor its affiliates is a bank. Wealthfront Brokerage conveys Cash Account funds to depository institutions that accept and maintain such deposits. The cash balance in the Cash Account is swept to one or more banks (the “Program Banks”) where it earns a variable rate of interest and is eligible for FDIC insurance. FDIC insurance is not provided until the funds arrive at the Program Banks.
The part that reads FDIC insurance is NOT provided until the funds arrive at the program bank.
deplorable 1
  |     |   Comment #13
It is insured by the SIPC until it is swept to the 4 FDIC insured banks. Some folks have concerns about whether or not the SIPC would cover the funds. A poster who actually has this account says it only takes about 1 day for the funds to be swept to the banks. Looks safe to me as long as you don't move over $250,000 in one transaction as this is the SIPC limit for cash. I can see why people would be concerned after Robinhood's botched rollout as they made claims without even checking with the SIPC first.
  |     |   Comment #19
Have you opened an account? We need more than just one person whose opened an account claims it only takes 1 day to transfer funds. I'd like to see more corroboration before I believe it takes only 1 day.
deplorable 1
  |     |   Comment #20
Not yet. I was waiting for a few more features to be added like 3rd party ACH withdrawals, checks, additional banks for ACH transfers etc. It looks like they just added transfers between cash management and their brokerage account.
  |     |   Comment #18
I believe you have good reason for concern. There are reasons that regulations differ between banks and brokerage firms. Even if they are not violating the letter of the regulations, they might be violating the spirit of the regulations. It's possible the government regulatory agencies frown on this kind of attempt at a hybrid structure and could challenge any claims after the failure of an institution. As far as I know, this has not been tested in the courts.
  |     |   Comment #24
The concept of combining sub-accounts across many "program banks" to enable FDIC insurance well above $250K is not new or innovative (Google "CDARS"). The problem with traditional CDARS accounts has often been their low interest rates.

With Wealthfront, a depositor/investor would need to be certain that they did have other assets in any of the "program banks" that might possibly push their total at that bank over $250K.

Also, from what I see Wealthfront has a management fee (essentially an expense ratio) of 0.25% for accounts balances above $5K. Maybe I've missed it, but I've not seen that cash-only positions would be excluded from that fee. If so, that lowers the interest rate to 2.57% minus 0.25% or 2.32%.
  |     |   Comment #26
The management fee only applies to Wealthfront invest, not to Wealfront's cash account...
  |     |   Comment #28
@deplorable1: I decided to keep Wealthfront after all (it was not officially closed yet)...I do like the higher rate, much higher ach transfer limits (SoFi is too low) and that they already have the "beneficiary" option in the online banking...They are also getting faster in responding to e-mails...I asked them about the added features and they said they hope to have all of them on by year's end...that would be debit card. atm access, checks direct deposit, ability to add them on to other bank's ach systems...Transfers in and out using their system, i have to be quite fast...only 1 day in or out...so the sweeps (in and out) from the program banks must occur pretty fast...I believe they are even considering expanding the program banks to 6 (which would the increase Fdic coverage to 1.5 million)...
deplorable 1
  |     |   Comment #29
They definitely have potential. 3rd party ACH withdrawals would make them a clear stand out in this category with unlimited withdrawals. Yes they could drop the rate but so could any FI like Sofi. Just look at Redneck/AllAmerica bank who would have thought they would drop their rate with a $50,000 cap. In this current rate environment it pays to have multiple options and the ability to move money quickly.
  |     |   Comment #30
I emailed wealthfront about,

how many business days holding period on ACH deposits, including time it takes to sweep into partner bank?

Will ACH deposit start earning interest immediately even before it's in partner bank?

Interest compounded daily?

customer service 24/7 instant message and phone support?

They said,
Funds typically get swept over the same day to the program bank but there can sometimes be a 1-2 delay in rare cases. The cash will start earning interest that same day the funds get swept into the program banks. In the rare 1-2 day delay then your cash will be in the money market fund TIMXX. Interest accrues daily and compounds monthly. The interest payment is calculated based on your cash account's daily balance during a given month. We do not have 24/7 support. M-F 8am-4pm PST.

Wealthfront’s cash account is neither your traditional checking or savings account. It is a high-interest cash account that offers many of the same features you typically associate with high-yield savings accounts, but with fewer restrictions.

I then asked,
Okay, so How many business days holding period on ACH deposits, including time it takes to sweep into partner bank?

How many business days to complete ACH withdrawal?

They said,
As I mentioned before, funds typically get swept over the same day (as we receive the deposit) to the program banks but there can sometimes be a 1-2 delay in rare cases.

Most withdrawals from cash accounts take 1-3 business days to complete. Please review this link for more information: How long does it take to transfer funds out of my cash account?

They still would not say holding times in the email, linked to a page that they just created that says, Withdrawals typically take 1-3 business days to arrive at your bank. It may take longer if, for example, you recently made a deposit or if you are withdrawing to a different bank account than the one used for initial funding.

There is a daily ACH transfer limit of $250,000, so any ACH transfers greater than that amount will be split over multiple days.

Note: To satisfy anti-money laundering regulations, there is a 5 business day hold on all new deposits before your funds can be transferred out of your account.

I get it now that they do 5 business day holds on ACH deposits, in comparison Ally does not do ACH holds, Schwab does 4 business day ACH holds (money is frozen until after the holding period).
  |     |   Comment #31
@ trailspeed: i have the account...i can confirm that it only takes 1 business for funds to transfer in or out using their ach system...when transferring in, it posts on that next business day to your account and the funds from the other bank are withdrawn at the same time....
The fact that i can schedule a transfer in today and it would post tomorrow along with funds drawn from the other bank should pretty much confirm that the sweep is also occurring that day (in most cases, as they said)...
  |     |   Comment #32
FYI, Betterment currently beats Wealthfront with 2.69% savings account
  |     |   Comment #33
I see the APY is 2.57% but what is the daily interest rate?
  |     |   Comment #34
Does that mean the daily interest rate is .007? I hope this isn't a stupid question. I am just trying to understand.
  |     |   Comment #35
Wealthfront CEO back in 2012 spoke about angel investing (venture capital). Unless you are worth at least one million and earning at least $200K a year, don't bother.
deplorable 1
  |     |   Comment #36
Good thing I waited since the rate is only 2.32% now no point in switching.
Wealthfront Brokerage Ups Cash Account Rate to 2.51% APY
UPDATE 6/27/19: The rate has been increased to 2.57% APY.

Deal Summary: 2.51% APY on balances of $1+

Availability: Nationwide.

Online brokerages are trying to compete with the online banks for deposits. The brokerages are coming out with cash management accounts that function a lot like savings accounts and checking accounts. In the last year, many of these cash management accounts have yields that challenge the online banks. The latest challenger is Wealthfront Brokerage. Two months ago, Wealthfront launched the FDIC-insured Cash Account with a 2.24% APY. According to this...

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