Rating:   4.5-star brokerage firm rating

2019 Robinhood Savings account review: checking, annual and monthly maintenance fees, ATM fee, interest rates, required minimum daily balance, pros and cons. Is Robinhood FDIC insured?

Robinhood Checking and Savings Accounts

If you’ve been using Robinhood as your broker for free stock, option, and ETF trades, you’re fixing to get even more. The company has announced it is going to offer cash management tools in early 2019. Specifically, there will be checking and savings accounts, plus a debit card.

Robinhood Savings Account APR

Robinhood Savings APY/APR Interest Rate

The interest rate on both the savings and checking accounts will be a staggering 3%. This will be higher than every online savings account of which we are aware. Ally Bank’s savings account currently pays 2.0%, while Marcus from Goldman Sachs is at 2.05%.

The cash management accounts at all brokerage firms are also lower than this rate. We found Fidelity at 0.31%, and E*Trade checking customers receive a paltry 5 basis points per year.

The Debit Card

The checking account will come with a free debit Mastercard, and Robinhood says that foreign currency transactions will carry zero surcharges. There is also no fee to replace a lost or stolen card.

Robinhood Debit Card

Robinhood ATM Access and Refunds

Robinhood has partnered with several retailers, pharmacies, big-box centers, and convenience stores to build a free ATM network of more than 75,000 cash machines. This figure is bigger than the number provided by the largest five banks in the United States combined. Some of the available stores on Robinhood’s network include Safeway, Target, 7-11, Walgreens, CVS, Kroger, and Costco. Withdrawals at these and other participating locations will be free of charge. The Robinhood mobile app will have a map of the 75,000 ATM’s; so finding one will be easy.

It appears at this time that Robinhood will not offer ATM fee refunds for transactions outside of this network. This will put the broker at a disadvantage when compared to other brokers that do offer ATM fee reimbursements.

Robinhood Savings Monthly Fee

There are no monthly fees at Robinhood Savings account.

Account Details

Neither the checking nor the savings will have any on-going fees or account minimums. Furthermore, Robinhood promises no overdraft fees, a great service. The broker’s deposit accounts can be used for everyday spending needs just like a regular bank account, although technically they are not bank accounts.

Whoa!! Wait a minute? Did we say these aren’t bank accounts? Yes. Technically, they aren’t bank accounts; and that’s the one big drawback in all of this.

Robinhood Savings FDIC Insured?

Cash balances held in a Robinhood checking or savings account are kept alongside a Robinhood investment account and do not constitute a separate bank account. Robinhood is not a member of the FDIC, and its checking and savings options are not FDIC insured. That’s a big caveat.

Robinhood is a member of SIPC, which offers protection on cash balances up to $250,000 per account holder.

Because Robinhood isn’t a bank, it had to partner with Sutton Bank to offer the debit card. While Sutton is a member of the FDIC, it doesn’t provide any insurance in this deal.

Robinhood Savings Fees

Say goodbye to the sneaky fees big banks charge. Robinhood Checking & Savings has no minimums, no monthly fees, no overdraft fees, and no foreign fees. Fee free, for real.

Robinhood Savings Review Final Thoughts

If Robinhood really can provide a high-yielding cash account with zero fees, it will challenge other brokers to raise rates on free cash balances. But 3% comes at price, as there’s no FDIC insurance or ATM fee refunds, both of which are available (with lower interest rates) at some of Robinhood’s rivals.

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Robinhood Savings reviewed by TopRatedFirms.com. Rating: 4.5