Vanguard cash interest rate

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Does Vanguard pay interest on uninvested cash as of July 2024?

If you have uninvested cash lying around on your brokerage account, you should make it work for you in a low-risk way instead of letting it lose value. Many brokers now offer meaningful interest on your idle cash.

Good news! Vanguard pays interest on your USD uninvested cash. Its interest rates are average compared to other brokers.

Earn money on uninvested cash (AI-generated image)

My key points regarding cash interest at Vanguard

Edith Balázs

Forex • Safety • Financial Journalism

I have personal experience with dozens of global brokers and have taken a closer look at which pay interest on cash, and under what conditions. Here are my key insights regarding earning interest on cash at Vanguard:

Vanguard offers up to 2.6% interest on USD uninvested funds.
This interest rate offering is average compared to what other brokers pay on USD.
Be aware that special conditions may apply, such as a minimum required balance.
Check the best brokers for cash interest to find brokers that offer the most attractive rates.

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Earn up to 2.6% on USD at Vanguard

Earning interest on uninvested cash in a brokerage account is a useful, low-risk way to preserve the value of your money. However, there can be significant differences among brokers when it comes to interest: some don't pay anything, while some brokers pay higher rates than banks.

Vanguard pays interest on uninvested cash: you can earn up to 2.6% on USD.

What are the benefits of getting interest on uninvested cash?

Earn additional money without active investing, preserving its value against inflation.
Keep cash easily accessible while generating returns.
By leaving idle cash on the account, you can save on potential withdrawal or conversion fees.
Offers a low-risk, hassle-free option compared to market investments.
Affords flexibility, providing time to plan investments without losing potential earnings.

While earning interest on your uninvested cash is great, there are a few things to keep in mind:

The advertised interest rate is annual, so you'll need to divide this by the number of months or days to understand your actual earnings. Interest is typically accumulated daily but paid monthly.
You may need to pay tax on the interest you earn. The tax typically depends on your country of residency, and is not deducted by the broker. It is your responsibility to report and pay the taxes.
In most cases, there's little reason to worry about safety when keeping cash in your broker account. In the US, for example, cash holdings are insured up to $250,000.
Be on the lookout for any special conditions the broker may set in order to pay interest, such as a minimum balance requirement.
If you maintain a broker account solely for the purpose of earning interest on your cash, choose a broker that doesn't charge an inactivity fee or regular account fee.

Interest rates at Vanguard are average

In order to have a verdict on how Vanguard stacks up against other brokers on the market with regard to interest rates on USD uninvested cash, we looked at several factors:

What the interest rates are: naturally, the higher the better.
Are there any conditions? We took two cases: the maximum interest you can earn, and the interest you can earn on $10,000. Brokers that offer interest already on low amounts, without any conditions, got a better rating.

Based on these factors, we found that Vanguard's offering for interest on USD uninvested cash is average.

You can find the detailed data in the table below for USD, as well as whether there is an inactivity fee.

Vanguard cash yield compared with main competitors
	Vanguard Vanguard	J.P. Morgan Self-Directed Investing J.P. Morgan Self-Directed Investing	Ally Invest Ally Invest
USD maximum cash yield Interest paid on uninvested USD	2.6%	0.0%	0.0%
USD cash yield in a $10k scenario Interest paid on uninvested cash	2.6%	0.0%	0.0%
Inactivity fee Fee applied if a customer does not trade for a certain length of time	No No inactivity fee	No No inactivity fee	No No inactivity fee

Data updated on July 22, 2024

You can also check out cash interest rates and conditions at other brokers:

Interactive Brokers DEGIRO TD Ameritrade eToro Saxo Charles Schwab TradeStation Global Fidelity J.P. Morgan Self-Directed Investing

'Conditions may apply': check the fine print for receiving interest

The interest you can earn on uninvested cash in your brokerage account may vary depending on different factors, so you should always check the exact conditions that apply.

The most frequent factors that usually influence the rate you will get are account type, minimum balance requirements, and account size, for example.

Below you can find all the information we have on cash interest at Vanguard, straight from our Vanguard review:

Interest on uninvested cash

Vanguard pays a 2.6% interest on uninvested USD.

Find the best brokers for earning interest on your uninvested cash

Does your broker not offer any interest on idle cash? Or do you want to check whether its interest rates are competitive with the rest of the market?

Check our toplist of the best brokers for cash interest to find brokers with the most attractive rates.

Check out this short video for a behind-the-scenes peek into how our experts personally test and evaluate brokers.

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Cash interest rate at Vanguard