High-Interest Cash Investing: How To Make Your Money Work

High-interest cash investing is a way to earn a competitive interest rate on your cash by keeping it in a high-yield cash account. This is not a traditional checking, savings, or even high-yield savings account. Instead, it is a cash account held at a brokerage firm that uses partner banks. The APY usually falls within the range of 1.00-2.00%, which is lower than what can be made over the long term in a retirement or investment account, but much higher than the average 0.41% savings rate that traditional brick-and-mortar banks offer.

High-yield savings accounts

Wealthfront's Cash Account can be used to pay bills, deposit cheques, send cheques, and use payment apps. Funds can also be transferred nearly instantly to connected Wealthfront investment accounts. This makes it a good option for those who are looking for a place to store cash that they do not want to invest right now but would like to at some point in the future.

Public also offers a high-yield cash account that can be used to store funds and earn interest with zero fees. There is no subscription required, no minimum balance to keep (or maximum to cap earning), and unlimited transfers and withdrawals. Public's Cash Account provides combined coverage of up to $5M because Public partners with 20 banks. That’s 20x the $250,000 FDIC coverage of a savings account.

Cash management accounts

If you're looking for a way to earn interest on your cash, you could consider a cash management account. These accounts are a solid option for earning high interest on your cash in the short term. Their APYs usually fall within the range of 1.00-2.00%, which is much higher than the average 0.41% savings rate that traditional banks offer.

One example of a cash management account is Wealthfront's Cash Account. This account allows you to earn a highly competitive interest rate on your cash, with a 5.00% APY and no minimums or account fees. You can also take advantage of features such as unlimited transfers, up to $8M FDIC insurance, and the ability to pay bills, deposit cheques, and use payment apps.

Another option is Public's high-yield cash account, which is linked to investing and provides combined coverage of up to $5M through partnerships with 20 banks. This account also has no subscription or minimum balance requirements and offers unlimited transfers and withdrawals.

Brokerage accounts

Another example is Public, an investing web platform and mobile app that offers a high-yield cash account as a secondary brokerage account. This account has no fees, no minimum balance requirements, and unlimited transfers and withdrawals. It also provides combined coverage of up to $5 million through its partnerships with 20 banks, which is significantly higher than the FDIC coverage of a traditional savings account.

It is important to note that while brokerage accounts can offer competitive interest rates, they may not always provide the highest long-term returns. Retirement or investment accounts, for example, may offer higher APYs over the long term. However, brokerage accounts can be a good option for short-term savings goals or for those who want easy access to their funds.

Hybrid accounts

High-interest cash investing is a way to earn a higher interest rate on your cash than you would with a traditional bank account. This can be done by keeping your money in a high-yield savings account, or a cash management account. These accounts are held at a brokerage firm that uses partner banks.

One example of a hybrid account is Wealthfront's Cash Account. This account offers a highly competitive interest rate of 5.00% APY with no minimums or maximums, zero account fees, and unlimited transfers. It also provides up to $8 million in FDIC insurance through partner banks on an individual account. With Wealthfront's Cash Account, you can also pay bills, deposit cheques, send cheques, and use payment apps.

Another example of a hybrid account is Public's Cash Account. This account is linked to investing and provides combined coverage of up to $5 million through partnerships with 20 banks. There are no fees, no minimum balance requirements, and unlimited transfers and withdrawals.

Retirement accounts

High-interest cash investing can be a great way to boost your retirement savings. By keeping your money in a high-yield cash account, you can earn a competitive interest rate that is often higher than what traditional banks offer. This can be an attractive option for those who are looking to park their cash in a safe place while they decide how to invest it in the future.

When choosing a retirement account for high-interest cash investing, it's important to consider the features that are important to you. For example, some accounts may offer unlimited transfers and withdrawals, while others may have a minimum balance requirement. It's also worth noting that some retirement accounts are linked to brokerage accounts, which can be useful if you plan to invest your money in the future.

One popular option for high-interest cash investing in retirement accounts is Wealthfront's Cash Account. This account offers a highly competitive interest rate of 5.00% APY with no minimums or maximums, zero account fees, and unlimited transfers. It also provides up to $8 million in FDIC insurance through partner banks on an individual account. Additionally, you can use this account to pay bills, deposit checks, send checks, and use payment apps.

Another option to consider is Public's high-yield cash account, which is linked to their investing web platform and mobile app. This account offers combined coverage of up to $5 million through their partnerships with 20 banks, which is 20 times the FDIC coverage of a traditional savings account. There are no subscription fees, minimum balance requirements, or maximum caps on earnings. Unlimited transfers and withdrawals are also included.

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