APY is an annual rate that includes the effects of compounding interest. With the Wealthfront Cash Account, interest accrues daily and compounds monthly. The interest payment is calculated based on your cash account's daily balance during a given month.
If you withdraw your funds at any time before the end of the month, you will still receive an interest payment on the first business day of the following month. For example, if you withdraw your funds on the 15th, you'll still receive an interest payment.
You can learn more about the APY calculation from Investopedia.
The Wealthfront Cash Account Annual Percentage Yield (APY) is as of November 1, 2019. The APY may change at any time, before or after the Cash Account is opened. The APY for the Wealthfront Cash Account represents the weighted average of the APY on the aggregate deposit balances of all clients at the program banks. Deposit balances are not allocated equally among the participating program banks.
Cash Account is offered by Wealthfront Brokerage LLC (“Wealthfront Brokerage”) a member of FINRA/SIPC. Neither Wealthfront Brokerage nor any of its affiliates are a bank, and Cash Account is not a checking or savings account. Wealthfront Brokerage conveys Cash Account funds to depository institutions that accept and maintain such deposits. The cash balance in the Cash Account is swept to one or more banks (the “Program Banks”) where it earns a variable rate of interest and is eligible for FDIC insurance. FDIC insurance is not provided until the funds arrive at the Program Banks. While funds are at Wealthfront Brokerage, and before they are swept to the Program Banks, they are subject to SIPC’s protection limit of $250,000 for cash. FDIC insurance coverage is limited to $250,000 per qualified customer account per banking institution.
Wealthfront Brokerage uses more than one Program Bank to ensure FDIC coverage of up to $1 million for your cash deposits. For more information on FDIC insurance coverage, please visit www.FDIC.gov. Customers are responsible for monitoring their total assets at each of the Program Banks to determine the extent of available FDIC insurance coverage in accordance with FDIC rules. The deposits at Program Banks are not covered by SIPC. This is not an offer, or solicitation of any offer to buy or sell any security, investment or other product.
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