Cash Sweep at Online-Only Banks — Retiree on Fixed Income
Recommended combination — this product and institution type align well with the retiree on fixed income profile.
Suitable match A Brokerage Cash Sweep at a online-only banks is a reasonable fit for a retiree on fixed income. The product's rate profile aligns with the priorities of this depositor type — drawing income from deposits. prioritises rate predictability, cd ladders, and f. See the suitability notes below for the specific trade-offs at online-only banks versus other institution types.
About Retiree on Fixed Income Depositors
Drawing income from deposits. Prioritises rate predictability, CD ladders, and FDIC/NCUA coverage across multiple institutions.
About Brokerage Cash Sweep at Online-Only Banks
The default rate applied to uninvested cash sitting in a brokerage account. Most brokerages default to extremely low rates (0.01–0.50%), quietly siphoning yield from idle capital.
Ally, Marcus, Discover Bank, American Express Bank. Consistently lead rate tables by 1–3 percentage points due to near-zero branch overhead.
Rate and Insurance at a Glance
| Attribute | Details (as of 15 May 2026) |
|---|---|
| Typical APY | 0.01–4.50% |
| Minimum balance | None (most institutions) |
| FDIC insured | No |
| NCUA insured | No |
Key Features for This Profile
- Automatic — cash sweeps without action
- Some brokerages now offer FDIC-insured sweep programs
- Can be replaced with money market funds at higher yield
What to Watch Out For
- Default rates are often negligible (0.01–0.45%)
- SIPC covers up to $250,000 in cash — NOT FDIC insurance
- Moving off the default sweep may require manual action
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