Betterment Checking and Cash Reserve: Online Cash Management Account Review
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Like most cash management account providers, Betterment is not a bank. It’s an online brokerage that helps customers invest their money. Betterment (paid non-client promotion*) sweeps customers’ funds into accounts at program banks, where they benefit from Federal Deposit Insurance Corp. insurance. Betterment has two complementary accounts: Betterment Cash Reserve and Betterment Checking.
Betterment Cash Reserve offers a solid annual percentage yield with no fees and no minimum balance requirement.
Betterment Checking has a debit card available and reimburses ATM fees worldwide. This account also has no monthly fees or minimum balance requirement.
Best for: Betterment customers who want a place to stow their cash while it isn’t invested and want to earn a high interest rate.
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» See how Betterment compares on NerdWallet's full list of best cash management accounts
Checking and savings features
5.0/5.0
Upsides:
Strong APY for Cash Reserve. The APY on Betterment Cash Reserve is currently a high 4.00%.*** New customers can earn 4.50% for three months after they fund their accounts, which they must do within 14 days of opening it. While not a bank account itself, this account has a rate that’s higher than most traditional brick-and-mortar bank accounts.
***Betterment says: *Current promotional rate; annual percentage yield (variable) is 4.00% as of 12/27/24, plus a .50% boost available as a special offer with qualifying deposit. Terms apply; if the base APY increases or decreases, you’ll get the .50% boost on the updated rate. Cash Reserve is only available to clients of Betterment LLC, which is not a bank; cash transfers to program banks (www.betterment.com/cash-portfolio) conducted through clients’ brokerage accounts at Betterment Securities. FDIC insurance is subject to certain conditions.
No monthly fees or minimum balance. Both the Betterment Cash Reserve and Betterment Checking products have no monthly fees or minimum balances.
Customers can withdraw cash, and ATM fees are reimbursed. Betterment reimburses all ATM fees incurred worldwide on its Betterment Checking account.
Debit cards are available. Customers can use a Betterment Visa debit card to access their funds in Betterment Checking.
» What is a cash management account? Check out NerdWallet’s guide to this financial product
FDIC coverage up to $2 million through affiliated partner banks. The FDIC typically insures up to $250,000 per depositor, per institution and per account ownership category. Betterment sweeps customers' funds into multiple partner banks to ensure coverage of up to $2 million (and up to $4 million for joint accounts).
Downsides:
No check deposits or check writing. With Betterment Cash Reserve, the only way to deposit and withdraw funds is through online transfer to or from a linked checking account.
Things to consider:
APY can fluctuate without notice. As with other cash management products, the program banks that Betterment partners with are subject to the changing federal funds rate, which is the set rate at which banks loan money to one another. This means that Betterment's APY varies in conjunction with the rates of its program banks. As with savings accounts at regular banks, the APY you open your account with is not guaranteed.
» Looking for more information about Betterment? Check out NerdWallet’s review of its investment services
Customer experience
3.5/5.0
Upsides:
High-quality website. The Betterment website is well-designed, and information on its different products is easy to find. There is also a robust Frequently Asked Questions section on the site that provides additional information on how Betterment’s products work.
High app store ratings. The Betterment mobile app is highly rated in both the Apple App Store and the Google Play store.
Downsides:
No branches. Betterment is an online-only service provider, so customers can receive help only through remote means of communication such as phone and mail.
Limited live phone support hours and no chat support. Phone support is available Monday through Friday, 9 a.m. to 6 p.m. ET. The site has no live online chat support, although a virtual chat assistant is available.
on Wealthfront's website
Wealthfront Cash Account
4.00%
$1
on Betterment's website
Betterment Cash Reserve – Paid non-client promotion
4.50%
$0
