Money Market Sweep Accounts, a money market sweep account offers a convenient and simple way to reinvest your money.
Never heard of sweep accounts?
These investment vehicles that provide higher interest rates while still offering liquidity include money market mutual funds, high interest investment or savings accounts, and even short-term certificates with 30-, 60- or 90-day maturities for known layovers in investments.How Sweep Accounts Work, a sweep account links a commercial checking discount rental cars toronto account with an investment account, such as a money market account or stock fund.Cash balances typically accumulate in a securities brokerage account as the result of: Proceeds from securities sales, income (dividends, interest, etc.) and distributions from investments held in the account.Breaking down 'Sweep Account sweeping funds provides the customer with the greatest amount of interest with the minimum amount of personal intervention.With a money market sweep account, any cash that accumulates in your account is automatically swept into a money market account.In fact, a recent study found sweep accounts to be one of the fastest growing and most profitable banking products.Rather, truly computerized pre-programmed automatic sweeps between brokerage accounts tends to be confined to set dollar amounts moved on a monthly basis.You earn interest on this money until you decide to reinvest.At the same time, you dont need to pay the additional fee and charges that an overdraft entails.Because most small businesses dont have the time or capital to reap the benefits of more profitable investments, sweep accounts make a lot of sense.
Rather than rely on your brokerage firm or bank to choose your money market account, take a proactive approach and ask your broker or bank to provide several options.
This is another effortless way to grow your funds.
You might invest in stocks or bonds, or you might keep your funds in a money market account.
Youre limited to a specified number of transactions per account before you start incurring extra fees.
Businesses and individuals need to keep an eye on the costs of sweep accounts, as the benefit from higher returns from investment vehicles outside the checking account can be offset by the fees charged for the account.
Benefits of Sweep Accounts, minimum investments.
Most banks charge a flat fee for a sweep account, although some may levy a percentage charge on yields.The bank automatically invests those funds in an account you select.With the changes of regulations on checking accounts, some banking institutions also offer high interest rates on amounts over certain balances.Automatic sweeps move funds electronically, per pre-set rules.This means you can grow your net worth faster.A business sets a minimum balance for its main checking account, over which any funds are swept into a higher interest investment product.