Liquidity with Purpose: Integrating High-Yield Cash Accounts into Your Wealth Management Strategy
When you have worked hard to achieve a certain level of success, financial flexibility becomes the ultimate luxury. The right checking and savings vehicles can create the ideal complement to the long-term plans you and your wealth advisor design.
Understanding Your Account Options
When weighing the best checking and savings accounts, you have many options. Premier Savings and Premier Checking accounts are worth your consideration. These high-yield accounts complement money market accounts, CDs and high-yield savings accounts (HYSAs), delivering on-demand liquidity and the returns you expect from your finances.
Here is how these account types differ:
- Premier Checking and Premier Savings: Western Alliance Premier accounts offer very attractive interest rates, with services and features that include priority client service, two complimentary wire transfers per month, unlimited check and ACH transactions, and relationship rates for mortgages and home equity lines of credit. These accounts require a minimum $150,000 deposit to waive account fees.
- HYSA (high-yield savings account): A HYSA offers an above-average interest rate (yield) but may limit the number of transactions and transfer method. In some cases, the rate decreases for balances above a defined limit.
- Money market account: Money market accounts offer the security and higher rates of an investment vehicle with more flexibility than stocks or bonds, but they typically limit the number of transactions you can make.
- Certificate of deposit (CD): CDs offer an attractive rate of return in exchange for “locking in” your money for a set period ranging from a few months to years. Withdrawing funds before the CD’s maturity date incurs a penalty.
Liquidity When You Need It
When it comes to near-term needs, HYSA, money market, CDs and Premier accounts can all be smart solutions to grow your money faster. Premier Checking and Premier Savings offer one significant advantage: unmatched access to meet the demands of your lifestyle while your money continues to perform.
With interest rates as much as eight to 10 times the national rate, these savings vehicles allow you to withdraw funds for those big moments – such as a wedding, home down payment, bucket-list vacation or college tuition – with ease and without penalty. As a general guideline, it’s wise to have six to 12 months of funds accessible for unexpected events and emergencies.
Penalty-Free and Tax-Efficient Savings
When choosing where to place your funds, it’s worth considering both flexibility and tax efficiency – two areas where high-yield cash management accounts have a distinct advantage.
Unlike IRAs, 401(k)s and other retirement vehicles, HYSA, money market and Premier accounts let you withdraw funds at any time without triggering early withdrawal penalties. And unlike stock investments, they don’t expose you to capital gains taxes when you access your money.
The one tax consideration to keep in mind: interest earned on these accounts is taxed as ordinary income. But for many savers, the combination of penalty-free access and no capital gains exposure makes high-yield accounts a smart complement to a broader financial strategy.
Flexibility and Benefits to Match Your Lifestyle
Tax efficiency is just one part of the picture. High-yield cash management accounts come with advantages traditional savings and checking accounts don’t offer. In addition to exceptional rates, these accounts may offer relationship rates on mortgages and home equity lines of credit, waived fees, unlimited transactions, free wire transfers, no-cost bill pay and other benefits.
At Western Alliance, our white-glove service provides direct access and elevated support from dedicated Private Client Group bankers who understand that you appreciate maximum flexibility to do business how and when you choose.
Many affluent individuals are also business owners or decision-makers. For you, Western Alliance offers another distinct advantage. As a business-first bank, we understand the many ways your business and personal matters interconnect. Our bankers can design a strategy that meets both your business and personal needs to provide the ultimate in service, flexibility and opportunity.
A Wealth Management Partner for You and Your Advisor
As a bank-only financial partner, Western Alliance Bank delivers flexible solutions that work with the carefully crafted plans you and your advisors have in place. Because we do not provide asset allocation or financial planning, we complement your wealth management strategies instead of competing with them. Contact a Western Alliance Private Client banker to explore how our concierge banking approach can work alongside your existing strategy.
Frequently Asked Questions
HYSAs are FDIC-insured, high-interest rate accounts that can be useful for reaching near-term savings goals. These accounts may have limitations on ACH transactions and maximum account balances.
Money market accounts are low-risk, FDIC-insured savings accounts that offer higher rates than traditional savings accounts but may limit the number of transactions you can make by check, debit card or electronic transfer. A money market account may require a minimum deposit amount to open the account
Certificates of deposit (CDs) are an FDIC-insured savings vehicle that provides a higher rate of return on your funds in exchange for “locking in” your money for a set period ranging from a few months to years. You’ll pay a penalty for withdrawing funds from the CD before the maturity date.
Western Alliance Premier accounts offer higher interest rates than a classic savings or checking account, with more services and features than most other account types: priority client service, relationship rates for mortgages and home equity lines of credit, two complimentary wire transfers per month and more. They also have greater flexibility than money market accounts or CDs, allowing for unlimited transactions at any time.
When it comes to emergency savings, the rule of thumb is to save enough to cover six to nine months of living expenses. For affluent individuals, emergency savings amount to a significant amount of money that should work for you while you wait to access it. Western Alliance Bank’s Premier accounts enable you to earn a higher rate of return on emergency funds while benefiting from unlimited checking and ACH transactions and dedicated client service for your financial needs.
Western Alliance Bank’s Premier accounts are the perfect vehicle to save for short-term needs. With higher interest rates, unlimited checking and ACH transactions, and two complimentary wire transfers per month, they offer ultimate flexibility and peace of mind.
Western Alliance Premier account holders benefit from better interest rates than traditional accounts, unlimited checking transactions plus two complimentary wire transfers per month, the support of a personal banker and relationship rates for mortgages and home equity lines of credit (HELOCs).
Western Alliance Bank
Western Alliance Bancorporation (NYSE: WAL) is one of the country’s top-performing banking companies and has ranked as a top U.S. bank by American Banker and Bank Director since 2016. Its primary subsidiary, Western Alliance Bank, is a leading national bank for business that puts customers first, delivering tailored business banking solutions and consumer products backed by outstanding, personalized service and specific expertise in more than 30 industries and sectors. With $90 billion in assets and offices nationwide, Western Alliance excels at helping businesses of all sizes capitalize on their opportunities to solve today and succeed tomorrow.