The company's latest offering is a low-risk
way to maximize interest with more tax efficiency than a savings
account or CD.
PALO
ALTO, Calif., May 7, 2024
/PRNewswire/ -- Wealthfront, a leading consumer fintech and pioneer
of the robo-advisor industry, today announced a first-of-its-kind
Automated Bond Ladder that revolutionizes how investors use US
Treasuries to maximize interest on their extra cash. This new
addition to Wealthfront's product suite is a liquid, low-risk way
to earn a steady yield, with more tax efficiency than a savings
account or CD.
Because US Treasuries are exempt from state and local income
tax, investors can keep up to 13.3% more of their earned interest
from the Automated Bond Ladder when compared to a high-yield
savings account or CD (depending on state of residence and tax
bracket). This tax efficiency plus the product's focus on
preserving principal makes the Automated Bond Ladder an ideal way
to balance out higher risk investments, protect and grow a
windfall, or save for large expenses without risking loss of
funds.
A ladder is an intelligent way to invest in low-risk Treasuries,
but accessing the strategy previously required considerable manual
work, high minimums, or expensive fees. With today's launch,
investors can open an Automated Bond Ladder with just $500, then Wealthfront's software instantly
compares rates across hundreds of state income-tax exempt US
Treasury bills and notes to build a ladder that helps investors
reduce interest rate risk and lock in rates for six months to six
years. The Automated Bond Ladder conveniently handles researching
and managing multiple maturity dates, adding more funds in
increments as low as $100, and
automatically reinvesting proceeds from interest and maturing bonds
to keep money growing effortlessly.
"Bonds are begging for modernization with the help of software.
Today's launch of the Automated Bond Ladder continues to redefine
what is possible when it comes to saving and growing your money by
bringing the same automated, set-it-and-forget-it approach to US
Treasuries that we brought to ETFs when we pioneered the
robo-advisor industry," said Dave
Myszewski, Vice President of Product at Wealthfront. "We're
proud to add another innovative way for investors to make the most
of fixed income, and we will continue expanding our product suite
to help our clients build long-term wealth."
Excitement about US Treasuries is at an all-time high, driven by
their unique combination of extremely low risk, stable yield (if
held to maturity), and exemption from state and local income tax.
In 2023, Treasury Bill purchases totaled $175 billion, making it the highest year on
record, and the trend has continued into 2024 with purchases
totaling $47 billion in Q1 alone.
Interest in laddering strategies is similarly strong among
Wealthfront clients: more than 50 percent of clients' external
Treasury holdings are held as part of a ladder.
Despite this growing demand, most of the current fixed income
offerings are decades behind what today's investors expect from
their financial products, leaving bond ladders reserved for
retirement planning or gated behind expensive financial advisors or
clunky interfaces. Thanks to Wealthfront's expertise in automating
sophisticated investing strategies, the capital preserving power of
a Treasury ladder is now available to the many investors eager to
lock in rates before potential cuts.
As Geoff Cleary, a Wealthfront
client who beta-tested the Automated Bond Ladder, said: "Faced with
the spectre of falling interest rates, I wanted to use a bond
ladder to grow my emergency fund, but I was immediately overwhelmed
by how much work and research it would take to build and manage one
myself. Wealthfront made the process so accessible with their bond
ladder, and it was perfect timing for me to start taking advantage
of US Treasuries to earn a higher after-tax yield."
Today's launch adds to Wealthfront's growing suite of innovative
saving and investing products designed to help clients build
long-term wealth in all market conditions. The company also offers
an award-winning Cash Account with a 5.00% APY via partner banks
and free same-day transfers through the RTP network, plus automated
index investing, retirement accounts, and adviser-managed,
zero-commission stock investing.
Wealthfront's focus on delivering innovation and value through
software is why clients continue to adopt new products rapidly and
why the business remains profitable and able to thrive in a variety
of market conditions. This is evidenced by the company recently
surpassing $60 billion in total
client assets across all product offerings and continuing to
maintain EBITDA margins over 40 percent.
For more information and to sign up for Wealthfront's Automated
Bond Ladder, please visit:
https://www.wealthfront.com/automated-bond-ladder
About Wealthfront
Wealthfront integrates investing and
saving products to help young professionals build long-term wealth
in any market condition. Through software, the company delivers
cash management, diversified ETF and bond investing,
zero-commission stock investing, and low-cost loans to help
sophisticated and new investors learn, lower costs, and grow
wealth. Wealthfront is one of the highest-rated financial apps in
the Apple App Store and has been named Best Automated Investment
App, Best Overall Robo-Advisor, and Best Robo-Advisor in the
Portfolio Construction, Portfolio Management, and Goal Planning
categories by Investopedia (2024), Best Cash Management Account and
Best Investing App by Bankrate (2024), Best Robo-Advisor for
Portfolio Options by NerdWallet (2024), and Best Robo-Advisor for
DIY Financial Planning by Forbes (2024). The company currently
oversees more than $60 billion for
over 800,000 clients in the US. To learn more please visit
www.wealthfront.com or download the app on the App Store or Google
Play.
Contact: Elly Stolnitz,
press@wealthfront.com
Disclosures
Treasury Bill purchase data from Treasury.gov: Sales, retrieved
from Fiscal Data
https://fiscaldata.treasury.gov/datasets/electronic-securities-transactions/,
Apr 22, 2024
The information contained in this communication is provided for
general informational purposes only, and should not be construed as
investment or tax advice. Nothing in this communication should be
construed as a solicitation or offer, or recommendation, to buy or
sell any security.
Investment management and advisory services--which are not FDIC
insured--are provided by Wealthfront Advisers LLC ("Wealthfront
Advisers"), an SEC-registered investment adviser, and financial
planning tools are provided by Wealthfront Software LLC
("Wealthfront").
Investing in US Treasuries involves risks, including but not
limited to interest rate risk, credit risk, and market risk. While
US Treasuries are considered to be among the safest investments,
they are not entirely risk-free, and there is a potential for loss
of principal. Returns on US Treasuries can also be affected by
changes in the credit rating of the US government, although such
occurrences are rare. Investors should consider their tolerance for
these risks and their overall investment objectives before
investing in US Treasuries. Past performance does not guarantee
future results.
The yield earned from US Treasuries is exempt from state and
local income taxes. However, interest income from Treasuries is
subject to federal income tax. Tax treatment may vary depending on
your individual circumstances and state of residence. Wealthfront
Advisers and its affiliates do not provide legal or tax advice and
do not assume any liability for the tax consequences of any client
transaction. To understand implications for your specific financial
situation, consult with a tax professional.
The unpaid testimonial featured above was made by a current
Wealthfront Advisers client. This party has no other affiliation
with or relationship to Wealthfront Corporation or its
subsidiaries.
Investopedia receives cash compensation for referring potential
clients to Wealthfront Advisers, LLC ("Wealthfront Advisers") via
advertisements placed on their website which could create an
incentive creating a material conflict of interest. While they
receive compensation for referring potential clients, the
statements and rankings provided above represent independent
endorsements by Investopedia, which are not directly tied to such
compensation. Investopedia and Wealthfront Advisers are not
associated with one another and have no formal relationship outside
of this arrangement. Investopedia's opinions are their own. Their
ratings are determined by their editorial team. Investopedia is not
a client of Wealthfront Advisers. Investopedia designed a system
that rates robo-advisors based on nine key categories and 59
variables. Each category covers critical elements users need to
thoroughly evaluate a robo-advisor. The ratings reflect data and
evaluations for the 12-month period ending in February 2024. Learn more about their methodology
and review process. Investopedia ranking as of March 2024.
Bankrate receives cash compensation for referring potential
clients to Wealthfront Advisers, LLC ("Wealthfront Advisers") and
Wealthfront Brokerage, LLC ("Wealthfront Brokerage") via
advertisements placed on their website which could create an
incentive creating a material conflict of interest. While they
receive compensation for referring potential clients, the
statements and rankings provided above represent independent
endorsements by Bankrate, which are not directly tied to such
compensation. Bankrate and Wealthfront are not associated with one
another and have no formal relationship outside of this
arrangement. Bankrate's opinions are their own. Their ratings are
determined by their editorial team. Bankrate is not a client of
Wealthfront Advisers. Bankrate designed a methodology that
evaluates app-based financial services—including robo-advisors,
brokerages, and mobile-only platforms, assessing overall
experience, features offered and total value proposition to the
investor. Best Investing App 2023 was awarded on January 10, 2023 based on data and evaluations
over the 12-month period ending in December
2022. Bankrate also designed a methodology that evaluates
non-bank cash accounts, evaluating APYs, checking features, service
fees, minimum deposit and balance requirements and other factors.
Best Cash Management Account 2024 was awarded on December 12, 2023 covering the 2023 calendar
year. Wealthfront pays an annual license fee to use Bankrate's
awards in marketing materials. Learn more about their methodology
and review process.
Nerdwallet receives cash compensation for referring potential
clients to Wealthfront Advisers, LLC ("Wealthfront Advisers") via
advertisements placed on their website. Nerdwallet and Wealthfront
Advisers are not associated with one another and have no formal
relationship outside of this arrangement. Nerdwallet's opinions are
their own. Their ratings are determined by their editorial team.
The scoring formula for online brokers and robo-advisors takes into
account over 15 factors, including account fees and minimums,
investment choices, customer support and mobile app capabilities.
Nerdwallet ranking as of June
2024.
Wealthfront Advisers, Wealthfront Brokerage and Wealthfront are
wholly owned subsidiaries of Wealthfront Corporation.
Copyright 2024 Wealthfront Corporation. All rights reserved.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/wealthfront-launches-first-ever-automated-bond-ladder-to-help-investors-earn-more-from-highest-yields-in-15-years-302137433.html
SOURCE Wealthfront