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A cash management account, or CMA, is a hybrid account that combines the features of a checking and a savings account. The main difference: A CMA is not a bank account. It’s typically offered by brokerages, making it a solid companion to an investment account and a place to keep your uninvested cash, especially if you have a lot of it. CMAs can insure more cash than the standard amount banks and credit unions cover.
How does a CMA work?
With a CMA, you can make transactions, write checks, earn high-yield interest and sometimes use a credit line that’s attached to your investment securities.
Like with savings accounts, CMA rates are also variable and can change at any time.
But your money is insured differently with a CMA. Because brokerages and fintechs are not banks, they can’t offer federal insurance themselves. Instead, they sweep your money into third-party banks to get your Federal Deposit Insurance Corp. coverage.
The upside: They can sweep your funds into multiple banks, giving you multiple times the usual coverage: Of the five CMAs NerdWallet reviews, FDIC insurance limits range from $1.5 million to up to $8 million.
The downside: This insurance is what’s called pass-through FDIC insurance. It covers your money in the event the partner bank fails, not in the event your brokerage or fintech goes out of business.
🤓Nerdy Tip
Some CMAs will give you the option to hold some of your money in a money market fund instead of sweeping the cash into an FDIC-insured bank account. A money market fund is a mutual fund that invests in high-quality, short-term securities. This means you'd be taking on market risk with your money though money market funds are considered less volatile, and lower risk, than many other investments.AD
on Wealthfront's website
Wealthfront Cash Account - Paid non-client promotion
APY
Up to 4.55%
Min. balance for APY
$1
on Betterment's website
Betterment Cash Reserve – Paid non-client promotion
APY
4.25%
Min. balance for APY
$10
Why choose a CMA?
Simplified account ownership. A CMA can streamline your finances by being your checking and savings at once. And since it’s offered by a brokerage, you can easily connect it to your investment accounts, too, all without having to transfer funds between different accounts.
Expert on the ground
Hanna HorvathCertified financial planner
High interest rates. Cash management accounts have annual percentage yields that are higher than what most brick-and-mortar banks offer, and they rival many online bank high-yield savings account APYs, too. For example, rates for the cash management accounts we review are similar to the rates offered by the best high-yield online savings accounts.
APYs for CMAs NerdWallet covers:
- Betterment Checking and Cash Reserve Account: 4.25% APY with boost; base rate is 3.50% APY
- Empower Personal Cash Account: 3.50% APY
- Fidelity Cash Management: 3.49%APY
- Vanguard Cash Plus Account: 3.50% APY.
- Wealthfront Cash Account: Up to 4.55% APY with boost; base rate is 3.55% APY
APYs for some of the top high-yield savings accounts (also known as HYSAs):
- Axos Bank (Axos ONE® checking and savings): 4.21% APY (after meeting certain requirements)
- Climate First Bank, Super Duper Savings: 4.01% APY
- Vio Bank High Yield Online Savings Account: 4.01% APY
- Marcus by Goldman Sachs High Yield Online Savings Account: 3.50% APY (annual percentage yield) as of 09/18/2026
- Barclays’ Online Savings: 3.20% APY
Nerdy Perspective
“I like that my CMA comes with a debit card. I keep my emergency fund in the account, so if something comes up, I have the ability to use the debit card to pay. And I also love that I'm able to make instant transfers to my primary checking account.
More federal insurance. If you have a lot of cash on hand — more than $250,000 — and want it all insured, a CMA can meet your needs because it can sweep your funds into partner banks, giving you more coverage, with the caveat that it’s pass-through FDIC insurance and functions differently than standard FDIC insurance.
Should you swap your HYSA for a CMA?
00:33
Compare: CMA vs checking vs high-yield savings accounts
CMA | Checking | High-yield savings | |
|---|---|---|---|
Primary purpose | Making transactions, earning interest on all funds in the account, easy connection to investing. | Receiving your paycheck, everyday spending, bill pay. | Holding your emergency fund, reaching savings goals. |
Who offers it | Brokerages and fintechs. | Banks, credit unions and financial technology companies (fintechs). | Banks, credit unions and fintechs. |
Insurance limits and type | Offer higher FDIC insurance limits; Wealthfront offers up to $8 million in FDIC insurance by sweeping your funds to be held at participating program banks, for example. | Up to $250,000 per person, per account type, per institution at FDIC member banks or National Credit Union Administration (NCUA) member credit unions; pass-through FDIC insurance at fintechs. | Up to $250,000 per person, per account type, per institution at FDIC member banks or NCUA member credit unions; pass-through FDIC insurance at fintechs. |
Monthly fee | All five CMAs NerdWallet covers charge no monthly fee or offer easy ways to waive it (like enrolling in e-statements). | Varies; many banks offer checking accounts with no monthly fee or with multiple ways to waive a fee. | Varies; many online banks offer high-yield savings accounts with no monthly fee or with multiple ways to waive a fee. |
Rates | Best yields hover around 3.5%; with promotional boosts, above 4%. | Usually don’t pay interest; if they do, it’s often 1% APY or lower. Higher APYs offered by checking accounts usually come with onerous requirements to earn the rate. | Best yields range from 3% to a bit above 4%. |
Cash deposit | Often not available at all or only for a fee. | Usually available, though sometimes not at online-only banks or only available for a fee. | Sometimes available. Some online-only banks may not offer this option or may offer it with a fee. |
Branch access | Usually not available. | Often available. | Sometimes available. |
» Think a checking account is better for you? See NerdWallet’s picks for the best checking accounts
Other accounts or investments may give you higher returns
If you have money you won’t need for a long time, you can consider investing it instead. You can get higher returns, though you take on the risk of losing money, too. Avoid investing money you’ll need in the next three to five years.
If you don’t want the gamble of the stock market but you do want high and guaranteed returns, consider opening a certificate of deposit. You can earn rates that are as high or higher than what you’ll find with the best CMAs. And unlike CMA rates, CD rates will be locked in for the duration of your CD.
» See what's available: NerdWallet's picks for best CD rates
Is a CMA right for you?
Consider a CMA if you:
- Want one account for checking and savings.
- Need quick access to your savings, even if you keep your checking elsewhere.
- Want your money easily connected to your investing account.
- Want to earn a good yield on all your money, not just savings.
- Need insurance past the regular FDIC limits.
- Like online banking.
A CMA may not be right for you if:
- You want to keep your savings and checking funds more separated. Though you don’t have to use your CMA as both your checking and savings, you can. If you want your savings to be less accessible, this isn’t the right account for you.
- You need in-person customer service. Like online banks, the brokerages that offer CMAs tend to have remote customer service like online chat or phone support.
Frequently Asked Questions
Can a cash management account replace my checking account?
It could, if you wanted it to, and as long as your cash management account came with the features you needed. Many, though not all, come with a debit card, bill pay, direct deposits and other typical checking account services that would make it easy for you to replace your regular checking account with a cash management account.
Do you pay taxes on cash management account interest?
Yes, you pay taxes on cash management account interest, just like you would your high-yield savings account interest. You’ll receive a 1099 tax form from your institution when tax time rolls around, typically in January.
