Should You Check Out Morgan Stanley’s New Cash Account?
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In the growing trend of financial service companies expanding their cash management account offerings, Morgan Stanley on Thursday announced the revamp of its own such product. The newly launched account, called CashPlus, replaces Morgan Stanley’s Premier Cash Management program.
Cash management accounts are not actually bank accounts; they are cash accounts offered by nonbank financial service providers — like brokerage firms and robo-advisors — that combine services and features of checking, savings and/or investment accounts, often with a high interest rate.
Morgan Stanley CashPlus, in contrast to many CMAs, doesn’t pay much interest, but it has some standout features:
Unlimited ATM fee rebates worldwide.
Unlimited check writing.
Comes with a debit card.
No foreign transaction fees when using the debit card.
No cash advance fees.
Cash withdrawals available from banks and tellers that accept Mastercard.
Details about Morgan Stanley CashPlus
Morgan Stanley CashPlus has some features in common with other CMAs — for example, customers’ funds are swept into partner banks, where they benefit from Federal Deposit Insurance Corp. protection behind the scenes — but it differs in a couple of major ways. Some specifics, according to the company:
Two different account options
CashPlus has two different account types: the Premier CashPlus and the Platinum CashPlus. The primary differences between the two options are the monthly fee amounts and how you avoid them. Both account tiers have a two-month grace period after account opening during which time no fee will be charged.
The Premier CashPlus account has a fee of $15 per month, which can be avoided by having one of these:
$2,500 monthly recurring deposit.
$25,000 average daily balance.
And both of these:
Morgan Stanley Online enrollment.
Another qualified non-Cash Plus, non-retirement Morgan Stanley account (e.g., an investment account).
The Platinum CashPlus account has a fee of $45 per month, which can be avoided by having all of these:
$5,000 monthly recurring deposit.
$25,000 average daily balance.
Morgan Stanley Online enrollment.
Another qualified non-CashPlus, non-retirement Morgan Stanley account.
Bonus benefits
In addition to unlimited ATM rebates, unlimited check writing, no foreign transaction fees and no cash advance fees, the Morgan Stanley CashPlus account offers identity protection through Experian, insufficient funds coverage, the ability to lock and unlock your debit card, price protection and robust online tools. Additional benefits at the Platinum tier include greater ID protection and a $550 "engagement bonus" if you have a Platinum American Express card from Morgan Stanley.
on Wealthfront's website
Wealthfront Cash Account
4.25%
$1
on Betterment's website
Betterment Cash Reserve – Paid non-client promotion
4.75%
$0
Things to consider about the account
Though Morgan Stanley CashPlus has some strong features, it doesn’t offer certain benefits common among other CMAs. Bear in mind:
The account earns very little interest
Most cash management accounts offer compelling interest rates that rival high-yield savings accounts. Morgan Stanley CashPlus is more on par with traditional brick-and-mortar checking accounts and offers 0.03% APY on balances below $250,000.
That monthly fee
Cash management accounts with other providers tend to be free. Though Morgan Stanley’s fees can be waived, customers must jump through quite a few hoops to make that happen.
» Want to compare features? Take a look at NerdWallet’s best cash management accounts
Is Morgan Stanley CashPlus right for you?
The big draw of cash management accounts is typically the high interest rate; that’s not a benefit of Morgan Stanley CashPlus. The account does offer some uncommon perks, particularly unlimited check writing and unlimited ATM fee rebates. For current Morgan Stanley brokerage customers, it may be convenient to have multiple financial services under the same roof. However, if you want to earn higher interest on your money, you may be better off looking at other cash management accounts or high-yield savings options.
