Robinhood Cash Management Account review: Hybrid checking and savings account with no foreign transaction fees

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The Robinhood Cash Management Account isn't accepting new customers currently. 

Pros and cons

Robinhood Cash Management

You may like the Robinhood Cash Management Account if you're looking for an account with no fees — you won't pay fees for using an out-of-network ATM or swiping your debit card abroad, and there are no monthly service fees.

You might not like the account if you want the option to overdraw, though. If you swipe your debit card and the transaction would overdraw your account, Robinhood simply denies the transaction.

You'll also only want to use the account if you receive your paycheck as a direct deposit. Right now, there's no way to deposit cash or paper checks into your Robinhood Cash Management Account.

The account pays a higher interest rate than typical savings and checking accounts, but it currently isn't available to new customers. 

How the Robinhood Cash Management works

You may know Robinhood as a financial services company that makes it easy to invest. The Robinhood Cash Management Account is its hybrid savings and checking account. It pays a relatively high interest rate like a high-yield savings account, but it comes with a debit card like a checking account.

To open a Robinhood Cash Management Account, you must also have a Robinhood brokerage account. Before the cash management account existed, you'd just keep cash in your brokerage account until you were ready to invest it in a stock or bond.

Now, the company sweeps your uninvested cash into Robinhood Cash Management, and its partner banks pay interest on your cash.

Robinhood has partnerships with several banks. Most banks insure your deposits for up to $250,000, but because Robinhood has multiple partner banks, your cash is FDIC insured for up to $1.25 million.

You'll have free access to over 75,000 ATMs. If you use an out-of-network ATM, Robinhood won't charge a fee, but the ATM provider might.

Robinhood trustworthiness and BBB score

The Better Business Bureau gives Robinhood an F rating. The BBB cites a large number of unresolved complaints as the reason for the score. 

Robinhood hasn't necessarily had scandals surrounding its cash management account — but is has faced scrutiny surrounding its investment platform. Since you have to have a Robinhood brokerage account to qualify for its cash management account, you might care about its investment platform issues.

Robinhood halted trading of AMC Entertainment (AMC) and GameStop (GSE) when prices spiked in January 2021, and it's facing lawsuits over this decision. In 2020, a young Robinhood user committed suicide when he lost money through investments. Robinhood saw backlash afterward, but it has since committed to providing more educational materials.

If the scandals surrounding Robinhood's investment platform worry you, you may decide to bank with another company.

Robinhood Cash Management Account vs. Wealthfront Cash Account

We've compared Robinhood to two other online investment platforms. See how it compares with Wealthfront below:

Like Robinhood, Wealthfront has a single cash account to keep both your savings and spending money, and you'll earn interest on your entire balance.

You may prefer Robinhood if you frequently travel abroad. Robinhood doesn't charge foreign transaction fees, but Wealthfront charges 2.75% of your purchase when you swipe your card abroad. If you withdraw money from a foreign ATM, Wealthfront charges an additional $2.50.

But you may like Wealthfront if you want to receive your paycheck sooner. With Wealthfront, direct deposits can be processed up to two days early. You can also deposit checks and cash with Wealthfront, whereas you're limited to direct deposits with Robinhood.

Robinhood Cash Management Account vs. Betterment Cash Reserve Account

Here's how the Robinhood Cash Management Account compares with the Betterment Cash Reserve Account.

You may prefer Betterment if you want to keep checking and savings in two separate accounts. There is a Betterment Checking Account and a Cash Reserve Account, which acts as a savings account. Having two accounts can make it easier to keep track of your money. But Betterment only pays interest on the money in your cash reserve account, whereas Robinhood pays interest on your entire balance.

You also may like the Betterment Checking Account if you want to earn cash back on your debit card purchases.

Frequently asked questions

Is Robinhood an actual bank?

Robinhood is not a bank. The company sweeps your uninvested cash into Robinhood Cash Management, and its partner banks pay interest on your cash.

What type of account is Robinhood Cash Management?

The Robinhood Cash Management Account is a hybrid account that combines savings and checking account features. You'll earn a competitive interest rate like a high-yield savings account, but it comes with a debit card like a checking account.