Vanguard Cash Plus Cash Management Account 2024 Review
The Vanguard Cash Plus Account is a cash management account that offers competitive yields with no minimum balance requirements or monthly fees. You can choose between an FDIC-insured bank sweep option or Vanguard money market funds.
Vanguard's Cash Plus Account is an alternative to traditional savings accounts and high-yield savings options. It's designed to hold short-term cash but you could also use it to save for emergencies or fund longer-term goals.
You might consider this account if you:
- Want to earn a competitive APY with a savings account
- Would like the option to save or invest your money with Vanguard funds
- Are looking for higher FDIC coverage limits on savings
- Prefer to avoid monthly maintenance fees
A Vanguard brokerage account isn't required to open a Cash Plus account. But if you do have one, the Cash Plus account could be a convenient option for holding uninvested funds.
You can use the bank sweep option to earn interest through a network of partner banks. Or you can deposit savings into one of five Vanguard money market funds. Each fund has a $3,000 minimum investment.
Vanguard Cash Plus Cash Management Account Pros & Cons
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Compared to Other Online Savings Accounts
Robinhood Cash Management Account
Robinhood offers a cash management feature with its online brokerage accounts. This account comes with a debit card that you can use to make purchases, withdraw cash or pay bills. This account doesn't earn interest but you can use round-ups to save automatically.
Read our full editorial review of the Robinhood Cash Management Account.
Fidelity Cash Management Checking Account
The Fidelity Cash Management account is designed for checking, saving and investing. You'll get a debit card and earn interest on balances, though the APY is below what you could get with Vanguard. There are no account fees or minimums and Fidelity reimburses foreign ATM surcharges monthly.
Read our full editorial review of the Fidelity Cash Management Checking Account.
Fruitful High Yield Savings Account
Fruitful offers one of the best savings account rates with no monthly fees or minimum balance requirements. You can make unlimited fee-free transfers and deposits are insured up to the standard FDIC coverage limits. Fruitful offers both joint and individual savings accounts online.
Read our full editorial review of the Fruitful High Yield Savings Account.
Rising Bank High Yield Savings Account
Rising Bank is another great option for high-yield savings if you have at least $1,000 to get started. There are no monthly fees and deposits are FDIC-insured. Rising Bank also offers other deposit accounts, including checking accounts and CDs.
Read our full editorial review of the Rising Bank High Yield Savings Account.
Interest Rates
Vanguard offers two options for earning interest on deposits:
- Bank sweep
- Vanguard money market funds
With the bank sweep option, you earn interest through a network of program banks. The advertised APY is on par with what you'll find offered at top online banks.
You can also earn interest by investing in one of five Vanguard money market funds. You'll need to check the fund prospectus to see the most up-to-date yield information.
A few of the funds offered pay higher yields than what you could get with the bank sweep. However, you'll pay an expense ratio to own the funds and you'll need at least $3,000 to buy shares.
If you're looking for something with a competitive rate and a lower barrier to entry, then you might choose the bank sweep to start. You can then compare yields for Vanguard funds once you've got a little more savings to invest.
Fees
Vanguard charges no monthly maintenance fee for its cash management account. That's similar to other online savings options.
Here's a closer look at this account's fee schedule.
Other Service Fees - Vanguard Cash Plus Cash Management
| Type | Fee |
|---|---|
| Monthly maintenance fee | $0 |
| Out-of-network ATM fee | $0 |
| Excess withdrawal fee | $0 |
| Foreign transaction fee | $0 |
| Stop payment | $0 |
| Overdraft fee | $0 |
| ACH transfer fee | $0 |
There is a $25 annual fee for this account. You can avoid the fee by enrolling in paperless statements.
Aside from those fees you'll want to check the fees for Vanguard's money market funds if you plan to invest in them.
While Vanguard is notable for charging some of the lowest expense ratios of any online brokerage, a fee is still a fee. So it's important to compare fund expense ratios to know what you'll pay to own them.
ATM Access
Some cash management accounts include a debit card or ATM card. However, you won't get that with the Vanguard Cash Plus account.
Is that a drawback? It depends on how you plan to use your savings account.
If you want to be able to withdraw cash as needed, then a debit or ATM card could come in handy. But if you're just looking for a place to hold short-term cash that you plan to invest, then Vanguard's cash management account could be a great fit.
And if you do decide to open a savings account that offers an ATM card, here's a tip. Look for a bank that offers unlimited ATM fee refunds.
Even if you don't visit the ATM that often, knowing you'll get a refund for surcharges means you have more options when deciding where to withdraw cash.
Account Management
You'll be able to manage your Vanguard Cash Plus account by logging in online. Vanguard also has a mobile app you can use to manage your accounts.
Once logged in, you can:
- Add or remove external bank accounts
- Buy Vanguard money market funds
- Update your preferences for dividend and capital gain distributions
- Transfer funds to or from your account
If you have other accounts with Vanguard, such as a brokerage account or an IRA, you'll be able to view them all from a single dashboard. That can make it easy to see what you have and track your net worth in one place.
There are no limits on how often you can transfer money. There is a dollar amount limit of $100,000 for daily withdrawals or deposits.
FDIC Insurance
FDIC insurance protects depositors in case a bank fails. So, if your bank goes under, your money is secure up to certain limits.
Vanguard offers FDIC coverage with the bank sweep option. Instead of getting $250,000 in coverage, you can get:
- $1.25 million in coverage for individual accounts
- $2.5 million in coverage for joint accounts
Keep in mind these limits only apply to the bank sweep. If you're buying Vanguard money market funds with your Cash Plus account, FDIC coverage doesn't extend to those balances.
What to Look for in a Savings Account
Opening a new savings account is a great way to get closer to your financial goals. The key is choosing the right bank or brokerage to save with.
If you're considering a savings account or a cash management account, here are a few things to keep in mind.
- Interest rate and APY
- Minimum opening deposit requirements
- Minimum balance requirements to earn interest or avoid a fee
- Monthly service fees, if any
- Other fees, such as excess withdrawal fees or investment management fees
- Online and mobile banking features
- ATM or debit card access
- Check-writing, if you're considering a cash management option
- Range of investment options (for cash management accounts)
- Branch banking access, if applicable
- Savings features and money management tools
- Deposit and withdrawal limits
- Overdraft protection
- Customer service and reputation
- Overall user experience
It may help to compare savings accounts at online banks first to see what they offer. You can then look at traditional banks or brokerages to see what kind of cash management options are available.
Frequently Asked Questions
What is Vanguard's Cash Plus account?
The Vanguard Cash Plus account is a cash management account. You can earn interest using a bank sweep feature or invest in Vanguard money market funds. Bank sweep balances earn a competitive APY with no monthly fees, while Vanguard funds earn impressive yields.
Can I pay bills from a Vanguard Cash Plus account?
It's possible to use the Vanguard Cash Plus account to pay bills. You can pay bills using your unique account number and routing number. That information is available in your account details when you log in online.
Is Vanguard Cash Plus a good savings option?
Vanguard's cash management account might appeal to people who already invest with the company or want to earn competitive rates on savings balances. Some of the best features include the lack of fees and the option to invest in Vanguard money market funds.
