Which sweep account for etrade

Don't just settle for a yield of 0. If you don't make a choice, many brokerages just keep your cash sitting there - doing nothing for you!

You have to make a choice to put your money to work for you! Some institutions are very flexible with what you use as your sweep account. There are some that even let you link your sweep account to your regular checking account. This can be very convenient if you draw on the cash in your brokerage regularly. On the same front, if you have a high-yield savings account, this could be a great sweep account.

It is important to note that the sweep feature is only available on standard brokerage accounts. If you have a retirement account, you need to look at how your cash is being handled in the account. Readers, are you maximizing your sweep account, or is your cash just sitting there? You can learn more about him on the About Page , or on his personal site RobertFarrington.

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Depending on the institution and investment vehicle, the sweep process is generally set daily from the checking account, while the return of funds can possibly experience delays.

With the changes of regulations on checking accounts, some banking institutions also offer high-interest rates on amounts over certain balances. A sweep account is a bank or brokerage account that transfers amounts that exceed, or fall short of, a certain level into a higher interest-earning investment option at the close of each business day.

For example, a bank's computers analyze customer use of checkable deposits and sweep funds into money market deposit accounts. Sweep accounts for individual investors are typically used by brokerages to park money waiting to be reinvested into high-interest holding accounts or into money market funds until the investor is ready to make a decision. A sweep account for a business allows small entities that rely on daily cash flow to maximize earning potential on their sitting cash reserves.

These accounts set a minimum balance for the main checking account, and any funds above that level are moved into a higher-interest investment product. Some institutions offer an auto-sweep feature whereby the sweep account is linked to the non-sweep account and the transfers are initiated automatically when the defined thresholds upper and lower are crossed.

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