Can a Money Market Fund work as a bank account? I compared Vanguard, Fidelity and Schwab to see which one may work as a regular bank account. Can Vanguard checkwriting on the Vanguard Federal Money Market Fund be used for bill pay? I look at this topic.
I compared eleven online high yield savings accounts paying 4.75% APY to 5.15% APY. Wealthfront, Marcus, Vio Bank, ValleyDirect, Redneck Bank, Evergreen Bank, Laurel Road, UFB Direct, Fidelity and Bask Bank.
All of these accounts are FDIC insured while the fidelity investment accounts are insured by the SIPC.
Fidelity is the only brokerage account that offers a high enough of an interest rate and enough features in order to compete with high yield online savings accounts. Schwab and Vanguard simply either don’t pay enough interest or have enough features.
High yield savings accounts still manage to beat Fidelity with a higher interest rate as well as FDIC insurance which is in my opinion far superior to the SIPC insurance offered by Fidelity brokerage accounts.
So in the end high yield savings accounts still win, however for those who use Fidelity for lots of investing it may still be a wonderful option.