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Robo-advisors can do more than manage your investments. Many of the top platforms also offer cash management accounts. These accounts pay interest on your uninvested cash and can provide traditional bank services, like ATM withdrawals and bill pay. Since robo-advisors use technology to reduce costs, their cash management accounts often pay better rates with lower account fees than the top banks.
Not all cash management accounts are equal in quality. Ideally, your account should earn a high interest rate, offer automatic sweep functionality, have low to no monthly fees, and include convenient banking and investment services. To help you find the right option, we’ve identified the best robo-advisor cash management accounts on the market today.
Best Robo-Advisor Cash Management Accounts of 2024
- Best Overall: Betterment
- Best for Paycheck Direct Deposit: Wealthfront
- Best for Traditional Banking Services: Merrill Guided Investing
- Best for Earning a High Interest Rate: Titan Invest
Best Overall : Betterment
Betterment
- Account Minimum: $0, $10 minimum to start investing
- Fees: 0.25% (annual) for investing plan accounts with at least $20,000 or at least $250 per month in recurring account deposits. Otherwise, the fee is $4/month. An additional 0.15% (annual) fee on accounts with at least $100,000 in assets provides account holders with unlimited access to certified financial planners, plus 1% crypto fee. This additional fee is applied to assets in the investment and cryptocurrency accounts, but not cash accounts. For accounts with at least $2 million, there is a fee discount of 0.10%. Crypto accounts are charged a monthly fee of 1% plus trading expenses.
With a high interest rate, available no-fee checking, no monthly fees, and free withdrawals from any ATM in the world, Betterment offers the best overall robo-advisor cash management account.
An incredible interest rate of 5.50% for new customers
Free withdrawals from any ATM in the world
No minimum balance requirement or monthly fees
No interest with the checking account
No automatic sweep for uninvested cash in your robo-advisor account
Betterment is one of the most popular robo-advisors in the world and delivers a stellar cash management account as well. Betterment has two cash management accounts. Its Cash Reserve account pays a high interest rate of 4.75%, with a 5.50% introductory annual percentage rate (APY) for new customers lasting the first 3 month. There’s no minimum balance requirement or monthly fee. You only need to deposit $10 to get started. Betterment also offers a checking account with free withdrawals from any ATM in the world and a debit card that earns cash back.
As a tech-focused company, Betterment does not have physical branches. Its cash management accounts take some coordination, too. To earn interest, you must manually move your uninvested cash into the Cash Reserve account.
Cash Reserve is only available to clients of Betterment LLC, which is not a bank, and cash transfers to program banks are conducted through the clients’ brokerage accounts at Betterment Securities. For Cash Reserve (“CR”), Betterment LLC only receives compensation from our program banks; Betterment LLC and Betterment Securities do not charge fees on your CR balance.
Checking accounts and the Betterment Visa Debit Card provided and issued by nbkc bank, Member FDIC. Checking is made available through Betterment Financial LLC. Neither Betterment Financial LLC nor any of its affiliates is a bank. Betterment Financial LLC reimburses ATM fees and the Visa® 1% foreign transaction fee worldwide, everywhere Visa is accepted.
Best for Paycheck Direct Deposit : Wealthfront
Wealthfront
- Account Minimum: $500
- Fees: 0.25% for most accounts, no trading commission or fees for withdrawals, minimums, or transfers
If you’re in a hurry to get paid, Wealthfront’s cash management account gives you your paycheck up to two days early while paying a terrific rate on your savings.
Excellent interest rate of 5.00% on all balances
Offers early access to paychecks with direct deposit
Free withdrawals from 19,000 ATMs
Charges $2.50 out-of-network ATM fees
Limited customer service options
Balance and deposit requirements for writing checks
Wealthfront is another leading robo-advisor with an excellent cash management account. It pays an impressive 5.00% APY on all balances (5.50% when you refer a friend). Wealthfront doesn’t charge a monthly fee for its cash management account or require a minimum account balance.
Wealthfront includes a debit card that offers free withdrawals from 19,000 network ATMs, including Safeway, CVS, and Walgreens. Directly depositing your paycheck into Wealthfront gives you your money up to two days earlier versus a traditional bank.
As a robo-advisor, Wealthfront does have some weaknesses compared to cash management accounts at more traditional brokers. Wealthfront has minimal phone customer service support, preferring that you get help through its website or mobile app or by email. It also charges a $2.50 fee for out-of-network ATM withdrawals on top of whatever the ATM owner charges. It’s not ideal and can get costly if you don’t pay attention to where you withdraw your money.
While Wealthfront does allow you to write checks, you must have held an average balance of at least $2,500 with all your Wealthfront accounts and directly deposited at least $250 to be eligible.
Best for Traditional Banking Services : Merrill Guided Investing
- Account Minimum: $1,000, or $20,000 with an advisor
- Fee: Annual 0.45% of assets under management, assessed monthly. With advisor—0.85%. Discounts available for Bank of America Preferred Rewards participants.
Merrill Guided Investing offers a cash management account with most typical banking services. This includes check-writing, ATM access, and bill pay directly from your investment balance.
Links check writing and bill pay to your investment account
ATM access through Bank of America
$200 annual reimbursement for out-of-network ATM withdrawals
Very low interest rate
$125 annual fee
Requires a large $250,000 balance at Merrill to avoid the annual fee
If you’d like more of a traditional banking experience from your cash management account, consider Merrill Guided Investing. Its cash management account allows you to write checks, pay bills, and make ATM withdrawals directly from your investment account balance. Merrill’s cash management account works with Bank of America ATMs, allowing you to deposit checks and cash.
Merrill’s cash management account refunds up to $200 a year for out-of-network ATM withdrawals. If you need help, you can speak with Merrill experts by phone or even in person at bank branches.
Merrill Guided Investing does have the limitations of a traditional brick-and-mortar bank. It pays a small interest rate of 0.01% on balances up to $1 million. The account also charges a $125 annual fee. You can get the fee waived, but it requires having at least $250,000 across all your Merrill accounts. Finally, the Merrill Lynch cash management account only provides $250,000 of FDIC insurance. While this is standard for regular banks, it is low compared to what many robo-advisor cash management accounts offer.
Best for Earning a High Interest Rate : Titan Invest
- Account Minimum: $500
- Fees: 0% for automated portfolios, 0.7% to 0.9% for active portfolios
Titan Invest’s Smart Cash account actively scans Treasury funds to find you the highest return on your uninvested cash.
Earns an amazing 5.33% APY
Actively scans for Treasury funds to net you a better return
Considers your tax situation for better returns
Withdrawals take three to four business days
Only allows electronic deposits and withdrawals
No ATM access or checking account services
If you’re trying to earn the best return possible on your uninvested cash, consider the Titan Invest Smart Cash account. This cash management account pays up to 5.33% APY, the highest rate for existing account holders of all the robo-advisors in this review. Titan Invest uses a unique system to earn a higher return. It scans different money market funds and Treasury funds daily to find the best spot for your money.
Titan Smart Cash also considers your tax situation to find Treasury funds that could net you tax breaks on your interest earnings. Titan Invest does not charge a monthly fee for its cash management account. The rate it quotes for your return is already adjusted for any potential expenses from the Treasury funds.
Titan Invest’s system does have some challenges for managing your money. It takes three to four business days to get your money from a withdrawal, as Titan Invest must sell off the Treasury funds first. Titan Invest’s cash management account does not include a debit card, ATM access, or other banking services. To take money out, first you’ll need to transfer it from Titan Invest to another bank account.
The Bottom Line
Robo-advisor cash management accounts can earn high interest rates and provide quality banking services. The right fit depends on your overall goals. Betterment has the best overall cash management account for robo-advisors, thanks to its high interest rate, no monthly fees, and free ATM access worldwide. Wealthfront is also excellent with the same advantages as Betterment, although its ATM access is not quite as good as it charges fees on out-of-network withdrawals. Wealthfront does a better job with direct deposit, giving you your money two days earlier than a regular bank.
If you want regular banking services with your robo-advisor, like check writing, in-person service, and ATM access to deposit cash, consider Merrill Guided Investing. Finally, while Titan Invest offers the best return thanks to its unique daily scanning system for the best Treasury fund rates, this comes with slower withdrawals and few banking services.
Compare the Best Robo-Advisor Cash Management Accounts
| Company | Monthly Fee | Interest Earned | Available Banking Services | Automatic Sweeps | FDIC Insurance |
|---|---|---|---|---|---|
| Betterment Best Overall | None | 4.75% APY, 5.50% as a sign-up bonus | ATM withdrawals, debit card for purchases, check writing | No | Yes, $2 million |
| Wealthfront Best for Paycheck Direct Deposit | None | 5.00% APY (5.50% when you refer a friend) | ATM withdrawals, debit card for purchases, early access to paychecks, check writing | Yes | Yes, $8 million ($16 million for joint accounts) |
| Merrill Guided Investing Best for Traditional Banking Services | $125 per year, can be waived for Merrill balances over $250,000 | 0.01% | Check writing, ATM withdrawals and cash deposits, in-person service, bill pay | Yes | Yes, $250,000 |
| Titan Invest Best for Earning a High Interest Rate | None | 5.33% | None | Yes | Yes, $5 million |
Guide to Choosing the Best Cash Management Account
As you compare different cash management accounts, these factors can help you determine the right fit.
- Annual percentage rate (APY): The APY is the interest earned on your cash management account balance. There can be a massive range from generous returns to practically nothing. Ideally, your APY should be as high as possible.
- FDIC insurance: FDIC insurance replaces your cash management account balance if the robo-advisor goes bankrupt. Some cash management accounts offer far more than the standard $250,000 of coverage traditional banks provide. Keep this in mind if you have an especially large cash balance.
- Fees: Robo-advisors can charge monthly fees for cash management accounts. They can also charge fees for ATM withdrawals, check cashing, and other services. Aim to keep fees low, especially since so many low-cost options are available.
- Account services: What banking services do you want from your cash management account? Some only earn interest and allow electronic withdrawals/deposits between accounts. Others offer a full range of banking services, including ATM access, check writing, bill pay, and direct deposit for paychecks.
- Investment services: You should also consider how a company’s investment services and robo-advisor match your needs. While you could open your robo-advisor and cash management accounts at different companies, having them in the same place is more convenient. You should also see if a company offers automatic sweeps, where it automatically moves your uninvested cash into the cash management account to earn interest.
- Customer service: What do you need for customer service with your cash management account? Many robo-advisors offer bare-bones support through email and a mobile app. Others provide phone and in-person support.
What Are Alternatives to Cash Management Accounts?
- High-yield savings accounts: High-yield savings accounts come from banks and credit unions. The best high-yield savings accounts pay interest rates as high as cash management accounts. A high-yield savings account would likely provide more banking services and support since it comes from an actual bank. However, savings accounts can limit how often you can make certain monthly withdrawals.
- Money market accounts: Money market accounts are also bank deposit accounts, with checks and an ATM card. The best money market accounts require larger balances than a traditional checking account and, in exchange, pay higher interest rates. A money market account could be better if you have a larger balance and want more checking account services. However, cash management accounts tend to have lower fees, especially if you have a smaller balance.
- Certificates of deposit (CDs): A CD locks up your money for a set period of months or years. In exchange, it pays a higher interest rate than other bank deposit accounts. But if you try to withdraw early, you forfeit interest as a penalty. The best CD accounts could be an option if you don’t need immediate access to your cash and want the highest possible interest rate. A cash management account is better for flexible withdrawals.
What Is a Cash Management Account?
A cash management account provides traditional banking services from a non-bank organization, like an investment firm, a broker, or a robo-advisor. Cash management accounts earn interest on uninvested cash. They may also provide ATM withdrawals, bill pay, check writing, and direct deposit. Non-bank organizations promote these accounts to attract new customers.
Are Cash Management Accounts Taxable?
Yes, your interest earnings from a cash management account are taxable. Each year, the company managing your cash management account will send you a statement showing your interest earnings, which you must report as income to the government. The same tax rules as earning interest from a bank account apply to cash management accounts.
Can You Withdraw Money From a Cash Management Account?
Yes, you can withdraw money from a cash management account, though the process depends on which robo-advisor you use. Some limit you to electronic withdrawals. You must transfer the funds to another bank account to make cash withdrawals or pay bills. Other cash management accounts include debit cards, which you can use to make purchases or withdraw cash using an ATM.
Methodology
Providing readers with unbiased, comprehensive reviews of digital wealth management companies, more commonly known as robo-advisors, is a top priority of Investopedia. Over a period of two months, our team of researchers, data collectors, and industry experts conducted an exhaustive review process that included in-depth industry research, company survey data collection, and hands-on demonstrations and evaluations of 19 robo-advisor platforms.
We then developed a quantitative model that scored each company to rate its performance across nine major categories and 57 criteria to find the best robo-advisors. The score for each company’s overall star rating is a weighted average of the criteria.
Many of the companies we reviewed also performed live demonstrations of their platforms and services in video calls with our research and editorial teams. Our team of expert writers and editors was also granted access to live accounts so they could perform hands-on testing. Through this all-encompassing data collection and review process, Investopedia has provided you with an unbiased and thorough review of the top robo-advisors.
Read our full Methodology for reviewing robo-advisors.
Separately, our research team conducted a survey of 205 U.S. adults aged 18 to 72 who are current clients of one of 18 robo-advisors. While the information collected did not influence the development of our ratings model, it was instrumental in gathering the valuable insights published in Investopedia's 2023 Robo-Advisor Consumer Survey.
Participants in our 2023 Robo-Advisor Survey opted-in to an online, self-administered questionnaire from a market research vendor. Data collection took place between Aug. 30, and Sept. 15, 2023, with 11 video interviews conducted with volunteer respondents from Sept. 7, to Sept. 17, 2023. Multiple quality checks, including screeners, attention gauges, comprehension evaluations, and logic metrics, among others, were used to ensure only the highest quality responses were included.
The above material and content should not be considered to be a recommendation. Investing in digital assets is highly speculative and volatile, and only suitable for investors who are able to bear the risk of potential loss and experience sharp drawdowns. Digital assets are not legal tender and are not backed by the U.S. government. Digital assets are not subject to FDIC insurance or SIPC protections.
Dotdash Meredith receives cash compensation from Wealthfront Advisers LLC (“Wealthfront Advisers”) for each new client that applies for a Wealthfront Automated Investing Account through our links. This creates an incentive that results in a material conflict of interest. Dotdash Meredith is not a Wealthfront Advisers client, and this is a paid endorsement. More information is available via our links to Wealthfront Advisers.