This year, investing in the financial markets has been a rocky ride. With the U.S. and global investment markets sinking, and then rebounding – somewhat – investors have a new found appreciation for cash. After nearly a decade of roughly zero returns on cash, those with uninvested funds can finally earn a decent yield.
Robo advisors were created to provide low fee investment management, and these fintech automated managers have delivered. In an effort to offer more to their clients, nearly all are expanding with additional services. In addition to financial advisors, customization with ETFs, cryptocurrency and active management, many provide high yield cash accounts.
Robo-Advisors with Human Financial Planner Access
|Robo Advisor||Management Fee||Investment Minimum||Sign up|
|0.25% of AUM||None||Sign up|
|zero for free tools - 0.89% - 0.49% AUM||zero for free tools - $100,000 for asset management||Sign up|
|0.25% of AUM ($10,000 managed for free)||$2,000||Sign up|
|Basic-None Premium-$30/month ($300 set up fee)||$5,000||Sign up|
|$1-$9 per month||None||Sign up|
Robo-advisor Cash Accounts
Since robo-advisors aren’t chartered as banks, most of the cash accounts partner with external banks. Without the cost of brick and mortar locations, robo-advisors can offer zero fee, high yield cash accounts. As the Fed raises interest rates, the yields on the robo advisory cash accounts are rising. Even if you don’t want to invest with a robo-advisor, you might consider opening a cash account to take advantage of the high interest payments. And, just like at a bank, these robo advisory cash accounts also carry FDIC insurance, to protect your principal, should the bank fail.
Best Robo Advisor Cash Accounts
1. Wealthfront Cash Account
The current Wealthfront Cash Account interest rate is 4.30%. The rate will vary based upon market interest rates.
Wealthfront is our best all-digital robo-advisor. This legacy digital investment manager owns the Path Financial Advisor, which is the closest tool you’ll get to a human advisor.
Following are some of the top features at Wealthfront:
- Well crafted digital investment portfolios.
- Access to hundreds of additional ETFs to add to your Wealthfront portfolio, or to set up for management by Wealthfront.
- Daily tax loss harvesting.
- Path digital financial planner, programmed to answer 10,000+ money and investment questions.
- Many account types including trusts and 529 college planning accounts.
2. Personal Capital Cash
The current Empower Personal Cash interest rate is 4.10% APY
Personal Capital is our favorite automated investment advisor for FREE investment management tools. With a suite of retirement planning, savings and spending trackers, along with investment reports. For those with $100,000, the Personal Capital Advisors team offers investment and financial management led by Certified Financial Planner advisors, for fees typically less than a traditional financial advisor.
Following are some of the top features at Personal Capital:
- FREE investment management tools.
- Able to link outside accounts for a 360 degree view of financial circumstances.
- Personal Capital Wealth Management Advisors provide a range of services, including investment management and assistance with tax and estate planning.
- Fees are below those of traditional financial advisors.
3. M1 Spend
M1 Spend Interest Rate – 3.3% APY*
M1 Spend is the high yield cash account associated with the M1 Finance investment manager. One of the most unique robo-advisors, M1 Finance offers over 65 customized investment portfolios and the opportunity to invest in the thousands of stocks and ETFs, for free, with no investment management cost. The company will rebalance all of your investments according to your preferred asset allocation.
Following are some of the top features at M1 Finance:
- Customized investment portfolios including, global income, retirement, general investing, hedge fund replica, sustainable investing and more.
- The screener enables you to craft a personal stock and/or ETF portfolio, in addition to the customized option.
- Crypto portfolios are coming soon!
- Fee free investment management or added features for just $125 per year. Click here for a free 3 month trial of M1 Finance Plus.
The current Betterment cash reserve interest rate is 4.0% APY.** The rate will vary, based upon market interest rates.
The Betterment robo advisor offers investment management, cryptocurrency portfolios, sustainable investing and various other investment options. For an additional fee, investors can access human financial advisors. The goal-focused saving and investing differentiate Betterment, with the opportunity to save and invest within various goal-based buckets. Betterment’s Cash Reserve account offers a solid return on your money and the mobile-first, Betterment checking is ideal for every day cash needs.
Following are some of the top features at Betterment:
- Comprehensive goal based investment manager with low fees.
- Impact sustainable investing, smart beta strategies, income only and innovative technology portfolios.
- Crypto currency portfolios (coming soon).
- Tax loss harvesting.
- Access to financial advisors, for an added low fee.
Best Robo Advisor for High Yield Cash Accounts – Wrap up
The volatile investment markets along with rising interest rates reminds investors that cash is an important asset class. It’s important to keep a cash stash for emergencies, vacation planning or any financial goal coming up within the next few years. With checking privileges at several of the robo advisory cash accounts, it’s becoming easy to keep all of your investing and cash management under one roof. Just be aware that as interest rates change, so will the yield on your robo-advisory cash account. Also, for those who crave a branch visit, you might be best served with a cash account at a traditional bank.
- Wealthfront Cash Account Review
- Personal Capital Cash Review
- M1 Finance Promo Codes
- Betterment Cash Reserve and Checking Review
- M1 Finance vs Betterment
Disclosure: Please note that this article may contain affiliate links which means that – at zero cost to you – I might earn a commission if you sign up or buy through the affiliate link. That said, I never recommend anything I don’t believe is valuable
Empower compensates Wealth Media, LLC. for new leads. Wealth Media, LLC is not an investment client of Empower.
†Betterment Cash Reserve (“Cash Reserve”) is offered by Betterment LLC. Clients of Betterment LLC participate in Cash Reserve through their brokerage account held at Betterment Securities. Neither Betterment LLC nor any of its affiliates is a bank. Through Cash Reserve, clients’ funds are deposited into one or more banks (“Program Banks”) where the funds earn a variable interest rate and are eligible for FDIC insurance. Cash Reserve provides Betterment clients with the opportunity to earn interest on cash intended to purchase securities through Betterment LLC and Betterment Securities. Cash Reserve should not be viewed as a long-term investment option.
Funds held in your brokerage accounts are not FDIC‐insured but are protected by SIPC. Funds in transit to or from Program Banks are generally not FDIC‐insured but are protected by SIPC, except when those funds are held in a sweep account following a deposit or prior to a withdrawal, at which time funds are eligible for FDIC insurance but are not protected by SIPC. See Betterment Client Agreements for further details. Funds deposited into Cash Reserve are eligible for up to $1,000,000 (or $2,000,000 for joint accounts) of FDIC insurance once the funds reach one or more Program Banks (up to $250,000 for each insurable capacity—e.g., individual or joint—at up to four Program Banks).
Even if there are more than four Program Banks, clients will not necessarily have deposits allocated in a manner that will provide FDIC insurance above $1,000,000 (or $2,000,000 for joint accounts). The FDIC calculates the insurance limits based on all accounts held in the same insurable capacity at a bank, not just cash in Cash Reserve. If clients elect to exclude one or more Program Banks from receiving deposits the amount of FDIC insurance available through Cash Reserve may be lower. Clients are responsible for monitoring their total assets at each Program Bank, including existing deposits held at Program Banks outside of Cash Reserve, to ensure FDIC insurance limits are not exceeded, which could result in some funds being uninsured. For more information on FDIC insurance please visit www.FDIC.gov. Deposits held in Program Banks are not protected by SIPC. For more information see the full terms and conditions (https://www.betterment.com/legal/cash-reserve) and Betterment LLC’s Form ADV Part 2 (https://betterment-prod-cdn.s3.amazonaws.com/agreements/Betterment_LLC_ADV_2022_08_03.pdf)