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Betterment Cash Reserve review

A savings account with unlimited withdrawal but only one way to access funds.

finder.com’s rating: 4.6 / 5.0

★★★★★

Betterment Cash Reserve, formerly called Betterment Everyday Cash Reserve, is a high-yield savings account with unlimited withdrawals. Plus, funds deposited into your Cash Reserve account are FDIC-insured up to $1 million. But there’s only one way to withdraw funds.

Cassidy Horton

Last Updated Apr 16, 2022

2.00%

APY

Fee

$10

Minimum deposit to open

Details

Features

Annual percentage yield (APY)	2% APY (annual percentage yield) as of 12 September 2022
Fee	$0
Minimum deposit to open	$10
Minimum balance to earn interest	$0
Interest compounding	Daily
More info	Go to site

Betterment says:

Betterment Cash Reserve ("Cash Reserve") is offered by Betterment LLC. Clients of Betterment LLC participate in Cash Reserve through their brokerage account held at Betterment Securities. Neither Betterment LLC nor any of its affiliates is a bank. Through Cash Reserve, clients' funds are deposited into one or more banks ("Program Banks") where the funds earn a variable interest rate and are eligible for FDIC insurance. Cash Reserve provides Betterment clients with the opportunity to earn interest on cash intended to purchase securities through Betterment LLC and Betterment Securities. Cash Reserve should not be viewed as a long-term investment option.

Funds held in your brokerage accounts are not FDIC‐insured but are protected by SIPC. Funds in transit to or from Program Banks are generally not FDIC‐insured but are protected by SIPC, except when those funds are held in a sweep account following a deposit or prior to a withdrawal, at which time funds are eligible for FDIC insurance but are not protected by SIPC. See Betterment Client Agreements for further details. Funds deposited into Cash Reserve are eligible for up to $1,000,000.00 (or $2,000,000.00 for joint accounts) of FDIC insurance once the funds reach one or more Program Banks (up to $250,000 for each insurable capacity—e.g., individual or joint—at up to four Program Banks). Even if there are more than four Program Banks, clients will not necessarily have deposits allocated in a manner that will provide FDIC insurance above $1,000,000.00 (or $2,000,000.00 for joint accounts). The FDIC calculates the insurance limits based on all accounts held in the same insurable capacity at a bank, not just cash in Cash Reserve. If clients elect to exclude one or more Program Banks from receiving deposits the amount of FDIC insurance available through Cash Reserve may be lower. Clients are responsible for monitoring their total assets at each Program Bank, including existing deposits held at Program Banks outside of Cash Reserve, to ensure FDIC insurance limits are not exceeded, which could result in some funds being uninsured. For more information on FDIC insurance please visit . Deposits held in Program Banks are not protected by SIPC. For more information see the full terms and conditions and Betterment LLC's Form ADV Part II.

The annual percentage yield ("APY") on the deposit balances in Betterment Cash Reserve ("Cash Reserve") is 2.00% and represents the weighted average of the APY on deposit balances at the banks participating in Cash Reserve (the "Program Banks") and is current as of September 12th, 2022. This APY is variable and subject to change daily. Deposit balances are not allocated equally among the participating Program Banks. A minimum deposit of $10 is required, but there is no minimum balance required to be maintained. The APY available to a customer may be lower if that customer designates a bank or banks as ineligible to receive deposits. APY applies only to Cash Reserve and does not apply to checking accounts held through Betterment Checking. Cash Reserve and Betterment Checking are separate offerings and are not linked accounts.

Review by

Cassidy Horton

cassidy.horton@findercrew.com

Cassidy Horton is a writer for Finder, specializing in banking and kids’ debit cards. She’s been featured on Legal Zoom, MSN, and Consolidated Credit and has a Bachelor of Science in Public Relations and a Master of Business Administration from Georgia Southern University. When not writing, you can find her exploring the Pacific Northwest and watching endless reruns of The Office.

Expert review

If you already invest with Betterment and are in the market for a savings account that has no monthly fees and up to $1 million in FDIC insurance, the Betterment Cash Reserve account may be right for you.

You can make unlimited monthly withdrawals, unlike traditional savings accounts that limit you to six transactions a month. But the only way to withdrawal money is through an ACH transfer, so you’ll need to have a checking account at another bank to access your funds.

Also, it’s worth noting that although Betterment considers Cash Reserve a high-yield savings account, the APY is closer to that of a standard savings account. By comparison, TAB Bank and Vio Bank offer high-yield savings accounts that earn 0.65% APY and 0.57% APY respectively. That’s far more interest than you’ll earn with Betterment.

How do I open a Betterment Cash Reserve account?

Open a Betterment Cash Reserve account online using the steps below:

Select Apply now.
From the official Betterment website, select Save from the menu.
Select Get started, then Let’s do this.
Enter your email address, then select Let’s do this again.
Create a password and select Continue.
Enter your legal first and last name, then select Continue.
Enter your phone number and select Continue.
Agree to the account’s terms and conditions.

Eligibility

You must meet the following requirements to open a Betterment Cash Reserve account:

At least 18 years old
US resident
Social Security number

Required information

Have the following information on hand when you open your account:

Government-issued ID
Social Security number
Date of birth
US residential address
$10 opening deposit

What are the benefits of a Betterment Cash Reserve account?

Betterment is a robo-advising platform, so its savings account was created with investors in mind. The Betterment Cash Reserve account has several unique perks including:

No withdrawal limits. Unlike traditional banks that limit savings account withdrawals to six, Betterment allows you to make unlimited withdrawals.
Minimal fees and no minimum balance requirement. You’ll never pay overdraft or monthly maintenance fees and you can keep as little or as much money as you’d like with this savings account.
FDIC-insured funds up to $1 million. Regular bank accounts are FDIC-insured up to $250,000, but individual Betterment Cash Reserve accounts are insured for up to $1 million while joint accounts are insured for up to $2 million.
Low opening deposit. You only need $10 to open this savings account.
Create separate stashes. This account lets you create separate buckets of cash for specific goals and set up auto-deposits for each one.

What should I look out for?

While the Betterment savings account has some attractive perks, there are also some drawbacks to watch out for.

No business accounts. You can’t set up a Betterment Cash Reserve account for your business.
No direct deposits. This savings account doesn’t support direct deposits, so you’ll have to link an external bank account if you want to transfer funds.
APY isn’t competitive. This account earns 2% APY on your balance, which isn’t competitive with the best high-yield savings accounts.

If you want to avoid deposit and withdrawal restrictions and earn a stronger APY, shop around for other high-yield accounts.

Is Betterment Cash Reserve safe?

Yes. Funds deposited into an individual Betterment Cash Reserve account are insured for up to $1 million, while funds kept in a joint account are insured for up to $2 million.

Betterment Cash Reserve account reviews and complaints

There aren’t many customer reviews of Betterment Cash Reserve online. The company isn’t accredited by the Better Business Bureau (BBB) as of April 2022, and it only has 15 customer reviews on the site. You’ll find five customer reviews on Trustpilot with an average 2.8 out of 5-star rating.

Reddit has a few threads, but most are from more than a year ago when the company was offering 2.14%+ APYs.

Compare Betterment Cash Reserve to similar accounts

We gathered a quick comparison of similar accounts to help you decide if Betterment Cash Reserve is right for you. For more options, select “Compare accounts” to compare even more savings accounts.

Betterment Cash Reserve	American Express® High Yield Savings Account	Aspiration Spend & Save Account

★★★★★ Finder rating 4.6 / 5	★★★★★ Finder rating 4.6 / 5	★★★★★ Finder rating 4.2 / 5
Go to site on Betterment's secure site	Go to site on American Express's secure site	Go to site on Aspiration's secure site
Fee $0	Fee $0	Fee $0
APY 2.00%	APY 1.90%	APY 5.00%
Minimum deposit to open $10	Minimum deposit to open $0	Minimum deposit to open $10
Minimum balance to earn interest $0	Minimum balance to earn interest $1	Minimum balance to earn interest $0

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How do I deposit or withdraw my money?

There are only two ways to deposit funds and one way to withdraw them with the Betterment Cash Reserve account.

Deposits

ACH transfer from an external bank
Wire transfer

Withdrawals

ACH transfer to an external bank

Frequently asked questions

How do I contact Betterment customer service?

There are two ways to chat with a Betterment customer service representative:

Call 718-400-6898 weekdays from 9 a.m. to 6 p.m. ET or weekends from 11 a.m. to 6 p.m. ET.
Email support@betterment.com

Can I transfer money between my Betterment Cash Reserve account and my Betterment investing account?

Yes. You can fund any investing goal in your Betterment investing account using funds from your Betterment Cash Reserve account. It usually takes two business days for the funds to clear your savings account and appear in your investing account.

What is Betterment’s routing number and SWIFT code?

You can’t make wire transfers or direct deposits into a Betterment Cash Reserve account, so it doesn’t have a routing number or SWIFT code.

How do I close my account?

Email customer support at support@betterment.com to begin the account closing process.

Savings account ratings

★★★★★ — Excellent

★★★★★ — Good

★★★★★ — Average

★★★★★ — Subpar

★★★★★ — Poor

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Betterment Cash Reserve review