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Wealthfront Cash Account: Pros and Cons
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Wealthfront Cash Account Features
The Wealthfront Cash Account pays a high interest rate. You'll earn 4.80% APY on your entire account balance. You can also earn an additional 0.50% APY for three months when you refer a friend.
Checking features include a debit card with free access to over 19,000 ATMs, online bill pay, direct deposits with the ability to get paid two days early, and the option to link your account to PayPal, Cash App, and Venmo. You also have access to Wealthfront investment accounts, so you can keep your savings, checking, and investments with one company.
Receiving your paycheck two days early means you can access your money faster and start earning interest sooner. If you move money from your Cash Account to your Investment Account, you can invest in the stock market in just a couple minutes — as a result, early direct deposit can help you invest two days early.
You only need $1 to open an account. There's no required opening deposit or minimum account balance, and Wealthfront doesn't charge monthly fees.
How Wealthfront Works
Wealthfront is an online-only investing and banking platform. It also offers one bank account, the Wealthfront Cash Account, which acts as a high-yield checking account.
Legally, banks can provide FDIC insurance for up to $250,000 per account, or $500,000 for a joint account. But Wealthfront is an investment/banking platform backed by banks, so it spreads your money across four banks — meaning it can insure up to $5 million, or $10 million for a joint account.
Wealthfront's website is easy to navigate, and its mobile app has received 4.8 out of 5 stars in the Apple store and 4.5 stars in the Google Play store.
To contact customer support, you can either send Wealthfront an email or call Monday through Friday, 10:00 a.m. to 8:00 p.m. ET.
Wealthfront: Is it Trustworthy?
The Better Business Bureau grades companies on trustworthiness. The BBB assesses whether a business is transparent in how it handles business, has honest advertising, and responds effectively to customer complaints.
The BBB gives Wealthfront an F rating because it has received nine customer complaints, and four are unresolved. A good BBB rating doesn't necessarily mean you'll have a smooth relationship with the company. Reach out to current customer or read online customer reviews to see if Wealthfront might be suitable for you.
Wealthfront vs. Betterment
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Wealthfront Cash Account
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Betterment Checking Account
You'll probably prefer Betterment if you want to set up separate checking and savings accounts with the same company.
The Betterment Checking Account doesn't pay interest like Wealthfront does. But its cash reserve account, or savings, pays interest. Betterment has a feature called the "two-way sweep" that helps you earn more interest on your money. Betterment regularly assesses your checking account to determine whether you have extra money based on your usual spending habits. If so, Betterment sweeps the extra funds into your cash reserve account, where it earns interest.
However, if you only have a checking account and not a savings account with Betterment, then none of your money will earn interest.
Wealthfront vs. Acorns
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Wealthfront Cash Account
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Acorns Spend Account
Acorns is another online investment platform, and although it offers a checking account, it doesn't have a savings account option. Instead, Acorns focuses on putting your extra money into your investment and retirement accounts.
Unlike Wealthfront, Acorns doesn't pay any interest on your checking account balance. It also charges a monthly fee of $3 to $9, depending on which subscription package you choose.
Basically, Acorns accounts all work together, and the company's main focus is clearly on investing. There isn't a point in having an Acorns Spend account without also using Acorns to invest and save for retirement.
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