Want to earn more interest in your savings account? Wealthsimple Cash might be your answer.
In January 2020, Wealthsimple Save was rebranded and updated with many new features and became Wealthsimple Cash.
When you open a Wealthsimple Cash account, you’ll be issued a prepaid debit card that allows you to earn cash back on everyday purchases, instantly send and receive money, and take advantage of other rewards.
Want to learn more? Keep reading to see my full Wealthsimple Cash review. I’ll go over its key features and benefits, as well as its one major drawback.
Prepaid Debit Card
Earn cashback on purchases with the Wealthsimple Cash card, earn interest on savings, and instantly transfer money to other WS Cash users
- Use your Wealthsimple Cash card anywhere Mastercard is accepted
- Withdraw funds from ATMs anywhere in Canada
- Earn 1% cashback (or crypto/stock rewards) on all purchases
- Open a joint account with your partner
- No monthly fees or minimum balance fees
- Earn 3% interest on direct deposits over $500
- Instantly send/receive money
- ATM withdrawals aren’t always free
- Doesn’t help you build credit
- No budgeting features
How Does The Wealthsimple Cash Account Work?
Wealthsimple is one of Canada’s top fintech companies. The company’s first financial product was a high-interest savings account called Wealthsimple Save, which launched in April 2018.
Two years later, a new and improved version called Wealthsimple Cash replaced the program. It was no longer a simple savings program that allowed users to earn interest on their savings.
In addition to savings perks, it also became a spending account and issued users a prepaid Mastercard that earns cash back on all purchases.
The Wealthsimple Cash account can be linked to any chequing account, allowing users to easily transfer money to and from their Wealthsimple Cash account.
Users can also use their Wealthsimple Cash account to receive direct deposits from employers and earn interest on deposits over $500.
Wealthsimple Cash: Benefits And Key Features
Now that you have a better idea of how the platform works let’s take a closer look at the most notable benefits and perks of opening a Wealthsimple Cash account.
The Wealthsimple Cash Card
As soon as you open a Wealthsimple Cash account, you’ll be issued a Wealthsimple Cash debit card. Your physical card may take a week or so to arrive in the main, but you’ll have instant access to your virtual card, which you can add to Google Pay, Apple Pay, or any other digital wallet you have.
To start using your card, simply link Wealthsimple Cash to your bank account, transfer funds (which can be done instantly), and you’re good to go.
Earn 1% Cash Back, Crypto And Stock Rewards
What sets the Wealthsimple Cash card apart from other prepaid debit cards is that you’ll earn 1% cash back on every purchase you make. Whether you’re filling up your gas tank, shopping at Costco, or buying a soda from the vending machine, you’ll earn your 1% cash bonus.
That’s not all, though.
You can also opt to receive your 1% cash back rewards in crypto or have it deposited into your Wealthsimple Invest account so it can be invested in the stock market.
If you choose to receive crypto back, you can choose to receive rewards in Bitcoin and other tokens offered by Wealthsimple’s crypto platform. The 1% credit will be issued to you in its equivalent cryptocurrency value and can be converted back into cash anytime.
If you choose to receive stock rewards, your 1% cash back will be deposited as a credit into your Wealthsimple Invest account.
From here, you can use the funds to purchase stocks, invest in ETFs, or take advantage of Wealthsimple’s robo-advisor platform, which will invest your money for you.
Wealthsimple Cash App Has A Great UI
I really appreciate the Wealthsimple Cash app’s user interface. It’s clean, uncluttered, easy to navigate, and rarely ever crashes or glitches. This makes Wealthsimple Cash a great platform, even if you’re not the most tech-savvy.
Users can also set up two-factor authentication or fingerprint authorization, which provides an added layer of security to your account and ensures that prying eyes won’t be able to access your Wealthsimple Cash account.
Your Funds Are Protected
The recent FTX scandal and collapse of the Silicon Valley Bank have left many Canadians wary of where they place their money. Naturally, you may ask, “Is Wealthsimple Cash safe?“
To be clear, Wealthsimple is NOT a bank.
However, Wealthsimple works with third-party banks that are insured by the Canada Deposit Insurance Corporation (CDIC). This means that your funds are insured for up to $100,000 in the event of a worst-case scenario.
If the holding bank collapses, you’ll be reimbursed for any amount up to $100,000.
Withdraw Money From ATMs In Canada
If you need cash fast, you can visit nearly any ATM in Canada and use your Wealthsimple Cash card to withdraw money from your Cash account.
While Wealthsimple doesn’t charge fees for ATM withdrawals, the transaction may be subject to a standard ATM withdrawal fee charged by the bank or the ATM company.
Can I Deposit Cash Into My Wealthsimple Cash Account?
Unfortunately, you cannot deposit cash directly into your Wealthsimple Cash account. You’ll need to transfer funds from your linked chequing account to fund your Cash account. If you have cash, you’ll need to deposit it in your primary bank account and then send it to your Wealthsimple Cash account.
Earn 3% Interest On Direct Deposits
If your employer issues direct deposits, then Wealthsimple Cash could be a great solution. The platform offers a 3% APY on all direct deposits worth over $500. This is a very competitive interest rate.
Interest also accrues daily and is issued to your Wealthsimple Cash account within seven days of the next month.
This is a great way to start saving money and is more than most high-interest savings accounts offer. The only downside is that it only applies to direct deposits that are left within your account, not standard transfers from your bank account.
Send Money Instantly
Whether you need to send money to your roommate or ask for a spot, Wealthsimple Cash allows users to easily send and receive money to and from other Wealthsimple Cash users.
This makes it one of the best alternatives to the popular US-based services, Venmo and Cash App.
Most transfers are instant and will be received within a few minutes of sending, making it far more convenient than traditional Interac e-Transfers, which can be a hassle.
Better Interest Rates Than A Traditional Savings Account
Wealthsimple Cash offers several opportunities for users to earn more with their account:
- 1% cash back on purchases
- 3% APY interest on direct deposits held in the account
- 4% APY interest on account balances over $100,000
I’ve already discussed the top two. However, the 4% APY on $100,000 balances is a game changer. This makes Wealthsimple Cash a worthy competitor to HISAs offered by EQ Bank, Neo Money, and others.
The $100,000 doesn’t have to be held in your Wealthsimple Cash account alone. It can be spread out across multiple Wealthsimple products, including:
- Wealthsimple Cash
- Wealthsimple Invest
- Wealthsimple Crypto
As long as your Wealthsimple accounts’ cumulative value totals $100,000 or more, you’ll earn 4% APY.
No Monthly Account Fees
Nobody likes account fees.
If you’re used to banking with a traditional “big-five” bank like RBC, TD Bank, Scotiabank, etc., then you’ve no doubt experienced fees such as:
- Low balance fees
- Monthly chequing account “maintenance fees”
- ATM fees
- Fees on Interac e-Transfers
Wealthsimple Cash doesn’t require users to maintain minimum balances, doesn’t charge frivolous maintenance fees, doesn’t subject users to ATM fees, and doesn’t charge for its money transfer services.
Wondering why these fees don’t apply to Wealthsimple Cash?
Since Wealthsimple is an online financial platform, it doesn’t have the high overhead that larger banks have.
The company doesn’t have to pay to build and maintain brick-and-mortar banks, which allows them to pass these savings onto Wealthsimple users. I would argue that reduced fees are one of the main reasons why people are flocking from larger institutional banks to smaller online banks and credit unions.
Open A Joint Account With Wealthsimple Cash
If you have a partner, you can open up a joint Wealthsimple Cash account. Users can log into the joint account, track spending, and load or transfer money. Each partner will also receive their own Wealthsimple Cash card with their name on it.
Are There Any Drawbacks To Wealthsimple Cash?
For the most part, I’m really impressed with what Wealthsimple Cash has to offer. The platform offers a great value proposition, allowing users to earn cashback on everyday spending, earn interest on savings, or simply take advantage of the Wealthsimple Cash money transfer service.
However, there are a couple of small drawbacks that are worth mentioning.
It Won’t Help You Build Credit
One of the main drawbacks of the Wealthsimple Cash card is that it does not help you build credit. Unlike a traditional credit card that allows you to earn cash back on purchases while building your credit, the Wealthsimple Cash card is simply a prepaid debit card.
Building your credit is very important if you plan on buying a house or want to receive better interest rates for:
- Financing a vehicle
- Applying for a personal loan
- Applying for a business loan
- Financing a new phone
Your credit score can even affect your ability to get approved for certain apartments and can determine the security deposit you must put down before moving in.
Additionally, good credit cards such as the AMEX Cobalt Card offer anywhere from 1.5% to 3% (and sometimes more) cash back on purchases, which is better than the Wealthsimple Card’s 1% cash back rate.
If you’re more concerned with improving your credit, I’d recommend using a credit card and keeping up with your monthly payments.
It’s not an either-or situation, though.
Even if you don’t use your Wealthsimple Cash card for everyday purchases, Wealthsimple Cash is still a great platform for savings, and I really like its easy money transfer service.
No Budgeting Or Spending Tracking Feature
One of Wealthsimple Cash’s biggest competitors is the Koho Card. This prepaid debit card is similar to Wealthsimple Cash and allows users to earn cash back on everyday purchases.
Koho also offers a built-in budgeting tool that allows its users to track their spending by category and set personal financial goals.
Unfortunately, Wealthsimple doesn’t offer the same.
To be fair, Wealthsimple is partnered with Mint (a great budgeting tool). However, you’ll need to sign up for a separate Mint account and link your Wealthsimple Cash account, meaning you’ll need to remember another username and password.
The Verdict – Is Wealthsimple Cash Worth It?
All in all, I’d say Weathsimple Cash is a great platform. From cash back on purchases to interest earned on savings and its instant money transfer service, Wealthsimple Cash is a multi-faceted platform that offers a number of benefits, no matter what you plan on using it for.
Plus, it’s fee-free, so you won’t pay any fees even if you open an account and don’t use it often.
The main downside is that Wealthsimple Cash won’t help you build your credit. If you want to start building your credit, I recommend signing up for one of these first-time credit cards and using it in addition to your Wealthsimple Cash account.