Advertiser Disclosure
Many or all of the offers on this site are from companies from which Insider receives compensation (for a full list see here). Advertising considerations may impact how and where products appear on this site (including, for example, the order in which they appear) but do not affect any editorial decisions, such as which products we write about and how we evaluate them. Personal Finance Insider researches a wide array of offers when making recommendations; however, we make no warranty that such information represents all available products or offers in the marketplace.
Written by Aly J. Yale; reviewed by Evelyn He
2023-07-12T22:50:14Z
- Pros and Cons
- Fidelity Cash Management Account Review
- FAQs
- How Fidelity Cash Management Compares
- Why You Should Trust Us
Our experts answer readers' banking questions and write unbiased product reviews (here's how we assess banking products). In some cases, we receive a commission from our partners; however, our opinions are our own. Terms apply to offers listed on this page.
Fidelity Cash Management Account
On Fidelity's website
Insider’s Rating
4.25/5
Fees
no monthly service fee
Annual Percentage Yield (APY)
2.60%
Minimum Deposit Amount
$0
Pros
- Solid interest rate
- No minimum opening deposit
- No monthly service fees
- Includes paper checks and a debit card
- Doesn’t charge out-of-network ATM fees
- Reimburses any fees charged by ATMs with Visa, Plus, or Star logos
Cons
- Other online accounts pay even higher interest rates
- Few physical locations
Product Details
- Online brokerage account that includes bank account features
- You can invest money in the account, but any money sitting uninvested in cash earns interest
- Interest compounds daily
- Cash balances are FDIC-insured
- Cash balances over $5 million may be swept into a money market fund, which is not FDIC-insured
Fidelity Cash Management Pros and Cons
| Pros | Cons |
|
|
Fidelity Cash Managment Review
Cash management accounts are hybrid checking/savings accounts offered by online platforms.
The Fidelity Cash Management Account blends features of a checking, savings, and brokerage account. You can use it to store and save cash, easily accessing it with a debit card or ATM as needed. Cash balances earn interest, and you can use your funds to invest.
The account currently pays 2.60% APY, which is much higher than traditional savings and checking accounts. There are no monthly service fee and no minimum balance requirements. Interest is compounded daily and paid monthly.
Cash held in your account is FDIC-insured (up to $250,000 for a solo account and $500,000 in a joint account). If you have more than $5 million in cash, Fidelity will sweep it into money market funds, which are not FDIC-insured.
Is Fidelity Trustworthy?
Fidelity has an A+ rating from the Better Business Bureau, indicating the company responds to customer complaints effectively and is transparent about its business practices.
The company has had a few recent public controversies. Fidelity was recently sued for its inclusion of certain investments in its retirement funds. The lawsuit claimed that the company breached its fiduciary duty and "pursue[d] leftist political agendas through environmental, social and governance strategies, proxy voting, and shareholder activism." Fidelity hasn't yet responded, but a recent court order requires the company — and fellow defendant American Airlines — to do so by August 4, 2023.
A former employee also won a wrongful termination suit against Fidelity, while another sued the company for discrimination and a hostile workplace. The plaintiff of the latter lawsuit voluntarily dismissed the case the next year.
Fidelity Cash Management Account
On Fidelity's website
Insider’s Rating
4.25/5
Fees
no monthly service fee
Annual Percentage Yield (APY)
2.60%
Minimum Deposit Amount
$0
Pros
- Solid interest rate
- No minimum opening deposit
- No monthly service fees
- Includes paper checks and a debit card
- Doesn’t charge out-of-network ATM fees
- Reimburses any fees charged by ATMs with Visa, Plus, or Star logos
Cons
- Other online accounts pay even higher interest rates
- Few physical locations
Product Details
- Online brokerage account that includes bank account features
- You can invest money in the account, but any money sitting uninvested in cash earns interest
- Interest compounds daily
- Cash balances are FDIC-insured
- Cash balances over $5 million may be swept into a money market fund, which is not FDIC-insured
Fidelity Cash Management FAQs
What is the interest rate on Fidelity's Cash Management account?
Fidelity currently pays 2.60% APY on its cash management account. This number is subject to change, though, so be sure to check Fidelity's website for the most up-to-date rates.
Is Fidelity's Cash Management Account the same as a brokerage account?
Fidelity's Cash Management account is technically a brokerage account, though it's not only for investing. You also get a debit card with the account, and it pays interest on uninvested cash — so you can use it for spending and saving your cash, as well.
Is Fidelity's Cash Management Account FDIC-insured?
The cash balance on your Fidelity Management Account is typically swept into an FDIC-insured account. Your funds are insured for up to $250,000 (for a solo account) and $500,000 (for a joint one). In certain cases, some funds may be swept into a money market mutual fund. These funds are not eligible for FDIC insurance.
Does the Fidelity Cash Management Account have fees?
The Fidelity Cash Management Account has no monthly or annual fees. There is a $0 minimum opening deposit, and most ATM fees are reimbursed the same day.
Does Fidelity have physical branches?
Fidelity does offer "Investor Centers" throughout the country, though they're not common and not in every state. The company currently has no locations in Alaska, Hawaii, Iowa, Louisiana, Mississippi, Montana, Nebraska, North Dakota, South Dakota, Vermont, West Virginia, or Wyoming.
How Fidelity Cash Management Compares
Fidelity Cash Management vs. Wealthfront Cash Account
Both Fidelity and Wealthfront are companies that specialize in investing but also offer cash management accounts. You can use both to save money, earn interest, and retain access to your funds via a debit card — all with no fees or minimum balances.
The big difference lies in the interest rates. While Fidelity's current 2.60% APY rate is good compared to traditional savings and checking accounts, it's significantly lower than the 5.00% APY you'll earn with the Wealthfront Cash Account.
Fidelity Cash Management vs. Betterment Cash Reserve
Betterment is another company that helps you invest, spend, and save. The Betterment Cash Reserve Account could be considered comparable to Fidelity's Cash Management Account — at least in basic features. It pays interest, has no monthly fees, and requires just a $10 minimum opening deposit. Betterment even offers up to $2 million in FDIC insurance, or $4 million for joint accounts.
Again, the big difference between these accounts is their interest rates. Betterment's currently sits at 4.75% APY (new customers will earn 5.50% APY for three months) APY for new customers through the end of 2023. You'll earn the standard rate after the promotional rate ends, which is still signifcantly higher than what Fidelity pays.
Fidelity Cash Management Account
On Fidelity's website
Insider’s Rating
4.25/5
Fees
no monthly service fee
Annual Percentage Yield (APY)
2.60%
Minimum Deposit Amount
$0
Pros
- Solid interest rate
- No minimum opening deposit
- No monthly service fees
- Includes paper checks and a debit card
- Doesn’t charge out-of-network ATM fees
- Reimburses any fees charged by ATMs with Visa, Plus, or Star logos
Cons
- Other online accounts pay even higher interest rates
- Few physical locations
Product Details
- Online brokerage account that includes bank account features
- You can invest money in the account, but any money sitting uninvested in cash earns interest
- Interest compounds daily
- Cash balances are FDIC-insured
- Cash balances over $5 million may be swept into a money market fund, which is not FDIC-insured
Why You Should Trust Us: How We Reviewed the Fidelity Cash Management Account
To review Fidelity's Cash Management Account, we rated the account using Personal Finance Insider's checking account methodology and added an additional category for interest paid.
In general, we look at ethics, customer support, and mobile apps when rating a financial institution or product.
Aly J. Yale is a freelance writer, specializing in real estate, mortgage, and the housing market. Her work has been published in Forbes, Money Magazine, Bankrate, The Motley Fool, The Balance, Money Under 30, and more. Prior to freelancing, she served as an editor and reporter for The Dallas Morning News. She graduated from TCU's Bob Schieffer College of Communication with a focus on radio-TV-film and news-editorial journalism. Connect with her on TwitterorLinkedIn.
Evelyn He
Compliance Associate
Evelyn He is a compliance associate at Business Insider who supports the Personal Finance Insider team. Personal Finance Insider is Business Insider's personal finance section that incorporates affiliate and commerce partnerships into the news, insights, and advice about money that Business Insider readers already know and love.The compliance team's mission is to provide readers with stories that are fact-checked and current, so they can make informed financial decisions. The team also works to minimize risk for partners by making sure language is clear, precise, and fully compliant with regulatory and partner marketing guidelines that align with the editorial team.Before joining Business Insider, she served in various legal and compliance roles in different industries, including the legal and pharmaceutical industries.Evelyn obtained her M.S. degree in Marketing at Boston University in 2022. Prior to combining and consolidating her knowledge of law and business, she spent one year finishing 1L courses at Suffolk University Law School to further her legal knowledge. She has also completed MBA business law courses while working on her Bachelor of Business Administration in Management at the University of Massachusetts, Amherst.Outside of work, she enjoys spending time with her 14-year-old Shih Tzu named Money, and her 5-year-old Bichon named Tibber.
Editorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card issuer. Read our editorial standards.
Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.
**Enrollment required.
NEW LOOK
Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview
Thanks for signing up!
Access your favorite topics in a personalized feed while you're on the go.
Watch: Watch Apple debut its own no-fee credit card
As an expert in personal finance and banking, I bring a wealth of knowledge and experience in various financial products and services. I have a comprehensive understanding of topics such as savings accounts, CDs, checking accounts, credit scores, loans, insurance (including life, homeowners, pet, and travel insurance), and investment options. My expertise extends to credit cards, mortgages, taxes, retirement planning, and financial planning. I am well-versed in evaluating and comparing different financial products, as well as providing insights into industry trends and best practices.
Now, let's delve into the article about the Fidelity Cash Management Account:
Fidelity Cash Management Account Review
Pros and Cons
-
Pros:
- Solid interest rate of 2.60% APY.
- No minimum opening deposit.
- No monthly service fees.
- Includes paper checks and a debit card.
- No out-of-network ATM fees; reimburses fees charged by ATMs with Visa, Plus, or Star logos.
-
Cons:
- While the interest rate is competitive, some online accounts offer even higher rates.
- Few physical locations for in-person services.
Product Details
- Online brokerage account with bank account features.
- Allows you to invest money in the account, with uninvested cash earning interest.
- Interest is compounded daily.
- Cash balances are FDIC-insured up to $250,000 for solo accounts and $500,000 for joint accounts.
- Balances over $5 million may be swept into a money market fund, which is not FDIC-insured.
How Fidelity Cash Management Compares
Fidelity Cash Management vs. Wealthfront Cash Account
- Both offer cash management accounts with features like no fees or minimum balances.
- Fidelity's 2.60% APY is lower than Wealthfront's 5.00% APY.
Fidelity Cash Management vs. Betterment Cash Reserve
- Both Fidelity and Betterment provide cash management accounts.
- Betterment's interest rate is higher, currently at 4.75% APY (5.50% for new customers for three months).
FAQs
-
What is the interest rate on Fidelity's Cash Management account?
- Fidelity currently offers a 2.60% APY, subject to change.
-
Is Fidelity's Cash Management Account the same as a brokerage account?
- Technically, it is a brokerage account, but it serves as both an investment and cash management account.
-
Is Fidelity's Cash Management Account FDIC-insured?
- Yes, cash balances are typically swept into an FDIC-insured account, with coverage up to $250,000 for solo accounts and $500,000 for joint accounts.
-
Does the Fidelity Cash Management Account have fees?
- No, there are no monthly or annual fees, and most ATM fees are reimbursed.
-
Does Fidelity have physical branches?
- Fidelity does have Investor Centers, but they are not available in all states.
Why You Should Trust Us
The trustworthiness of Fidelity is assessed through its A+ rating from the Better Business Bureau, indicating effective response to customer complaints and transparency. However, recent controversies involving lawsuits and employee issues are highlighted, providing a balanced perspective on Fidelity's reputation.
About the Authors
The article is authored by Aly J. Yale, a freelance writer specializing in real estate and mortgage, and reviewed by Evelyn He, a compliance associate with a background in legal and compliance roles.
Conclusion
The Fidelity Cash Management Account offers competitive features, and its pros and cons are thoroughly analyzed. The comparison with other accounts helps readers make informed decisions based on their financial preferences. The inclusion of FAQs and insights into Fidelity's trustworthiness enhances the overall reliability of the article.
In summary, this article serves as a comprehensive guide for individuals seeking information about the Fidelity Cash Management Account, providing a well-rounded perspective on its features, comparisons, and trustworthiness.
