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The Vanguard Cash Plus Account offers a high interest rate and federal insurance up to $1.25 million for individual accounts. It’s a cash management account, which provides the services and features of checking or savings accounts, but these types of accounts are typically offered by brokerages, not banks. These brokerages sweep customer deposits into accounts at partner banks behind the scenes to provide insurance.
Best for: Vanguard customers who wish to earn a high interest rate and have access to a higher-than-average federal insurance limit on their savings.
Reviewed in: Feb. 2024. Period considered: Feb. 2024.
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| Where Vanguard falls short |
|---|
Offers a high annual percentage yield. Annual fee is easily waived with e-statements. High federal insurance limit through partner banks.
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Checking and savings features
Upsides
High interest rate. With a rate of 4.70% APY, the Vanguard Cash Plus Account rivals the rates found on many high-yield savings accounts.
No minimum balance requirement. The account doesn’t require customers to maintain a minimum balance to keep the account open.
High federal insurance through third-party banks. Vanguard works with partner banks to sweep customer funds into accounts that are insured by the Federal Deposit Insurance Corp. Customers can get up to $1.25 million in insurance on their deposits or up to $2.5 million for a joint account.
Easy way to avoid annual fee. The account comes with an annual fee of $25 that can be waived if you sign up for e-statements.
Unlimited number of transactions. There is no limit to the frequency of transactions that can be made with the account.
High withdrawal limit. Customers can withdraw up to $100,000 in a single business day.
Downsides
No way to withdraw or deposit cash, and no check writing. The only way to move money with the Vanguard Cash Account is through online transfers using your routing and account numbers. The account can also receive direct deposits.
Customer experience
Upsides
Solid website and decent app ratings. Vanguard’s website is easy to navigate, and its mobile app has decent ratings in the Apple and Google app stores.
Mobile check deposit available. Customers enrolled in Vanguard Cash Plus are able to fund their account with the Vanguard mobile app.
Downsides
Limited customer service phone hours. Vanguard offers extended daytime hours of 8 a.m. to 8 p.m. Eastern time for phone customer service, but there are no weekend hours.
FAQs
Upsides. High interest rate. With a rate of 4.70% APY, the Vanguard Cash Plus Account rivals the rates found on many high-yield savings accounts. No minimum balance requirement.
Is a Vanguard cash deposit worth it? ›
Vanguard Cash Deposit
May be appropriate for money you want to keep accessible for trading. Offers FDIC insurance for up to $1.25 million for individual accounts and $2.5 million for joint accounts.* Gives you another option for your settlement fund in addition to the Vanguard Federal Money Market Fund.
Is it safe to have all my money at Vanguard? ›
Thus, having all of your investments in several Vanguard funds is tantamount to having your investments spread among a variety of baskets, each independent of the other. So, put your fears to rest; your investments are safe at Vanguard.
What are the cons of Vanguard? ›
Cons
- Relatively high minimum investment requirements for many fund options.
- Higher-than-average per-contract options fee.
- Slow process to open an account.
- No trading platform for active traders.
- No fractional shares of stocks or ETFs.
Account Eligibility.
To be eligible to participate in the Cash Plus Account Pilot, You or a joint owner must be an account holder on a VBA. One or more of the Cash Plus Account holders are also required to maintain at least one VBA for as long as the Cash Plus Account is open.
Is Cash Plus account safe? ›
Your eligible deposits with Cashplus Bank are protected up to a total of £85,000 by the Financial Services Compensation Scheme (FSCS), the UK's deposit protection scheme. This limit is applied to the total of any deposits you have with Cashplus Bank. You can find out more about FSCS protection here.
What is the interest rate on a Vanguard cash Plus account? ›
Vanguard Cash Plus Account interest rate
| Account | APY | Minimum Balance |
|---|
| Vanguard Cash Plus Account | 4.70% | $0 |
Apr 24, 2024
Any cash in your account will earn interest daily and will normally be paid into your account on the first working day of the month.
What is current interest rate on Vanguard cash deposit? ›
The company also launched a cash deposit option for sweep accounts called Vanguard Cash Deposit, which has an APY of 3.7% as of August 2023 and similar FDIC coverage.
Can Vanguard fail like a bank? ›
So, what if Vanguard's brokerage fails? First, the chances of Vanguard failing are miniscule. That said, let's talk about brokerage accounts for a minute. Brokerage accounts are not backed by the FDIC but by the Securities Investor Protection Corp (SIPC), which protects accounts up to $500,000.
The Vanguard Cash Plus Account is a cash management account that features a bank sweep insured by the Federal Deposit Insurance Company (FDIC) and offers a competitive yield on your short-term savings. You can use the bank sweep as a low-risk place to keep cash for your immediate needs as well as for emergencies.
Why are investors pulling money from Vanguard? ›
When the market cratered, investors withdrew $16.4 billion from Vanguard's index mutual funds. What accounts for remaining index mutual fund outflows? Johnson says it could be clients pulling out money because they're retiring, or because they're negatively affected by the pandemic.
What happens if Vanguard goes bust? ›
The securities that underlie the funds are held by a custodian, not by Vanguard. Vanguard is paid by the funds to provide administration and other services. If Vanguard ever did go bankrupt, the funds would not be affected and would simply hire another firm to provide these services.
Why do people prefer Vanguard over Fidelity? ›
While both institutions offer robo-advisors, Vanguard's Personal Advisor Services, which is available to clients who can meet a $50,000 account minimum, offers a little more hands-on investment guidance and assistance with portfolio construction. Vanguard also has slightly lower expense ratios on its index funds.
Is Charles Schwab or Vanguard better? ›
The truth is that either broker is suitable for a long-term investor, depending on one's needs. Vanguard could be a better choice for passive investors who want index funds; Charles Schwab offers more features that appeal to active investors. Ultimately, the better brokerage is dependent on how you invest.
How does a cash plus account work? ›
How does Cashplus work? Cashplus works the same as a high-street bank. You can open a personal current account that comes with all the features you'd expect from a traditional bank. However, you'll have to pay to open a personal account with Cashplus and there are three different payment options available.
What is the interest rate on Vanguard cash deposits? ›
The company also launched a cash deposit option for sweep accounts called Vanguard Cash Deposit, which has an APY of 3.7% as of August 2023 and similar FDIC coverage. Vanguard began piloting Vanguard Cash Deposit and Vanguard Cash Plus with small groups of existing clients in January 2022 and August 2023, respectively.
Can you withdraw cash from Vanguard account? ›
Once you have cash available in your account, you can withdraw it following these steps: Log into your account. From the left-hand menu, go to 'Payments' Choose the 'Money out' tab.
What is the difference between total cash and available cash in Vanguard? ›
Your total cash reflects the cash portion of your portfolio value. It includes cash from completed trades, deposits and withdrawals but excludes any pending cash transactions. Your available cash is the cash available for trading or withdrawals.
