Robinhood’s New Savings Account is FDIC-Insured! 2.05% APY
Robinhood brokerage has finally re-launched the high-interest cash sweep option after their failed (and illegal?) 2018 mash-up of checking accounts and SIPC-insurance. Robinhood Cash Management is basically what many other places like Betterment Savings have implemented, a FDIC-insured sweep account backed by a mix of different partner banks. The interest rate is variable and currently 2.05% APY as of 10/8/19. This is a pretty competitive rate when compared to other cash alternatives. Debit card has no fees on the Allpoint ATM network. Unfortunately, as is usual with Robinhood, you’ll have to join a long waitlist first.
This was an important move for Robinhood, as many of the established giants have joined the free stock trades party – Schwab, TD Ameritrade, E-Trade, Interactive Brokers, Ally Invest. However, not all of them offer competitive rates on idle cash. Schwab is notably bad in this regard. However, Schwab does offer well-trained humans and instant customer service via phone call. Robinhood has a slick app and user interface, but they don’t readily offer a phone number. Instead, you must wait around for a reply on their online messaging service. If I put a huge chunk of my net worth in a broker, I want a phone number.
So basically, there are free trades, high interest on idle cash, and good customer service. Which are the most important to you?
“The editorial content here is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author’s alone. This email may contain links through which we are compensated when you click on or are approved for offers.”