Put your cash to work with Smart Yield

Smart Yield is our automated cash management product that automatically allocates your funds to strategic money market funds invested in U.S. treasuries, government securities, or municipal bonds. Our intelligent system analyzes your tax situation to select investments with potential federal, state, and local tax advantages, aiming to deliver competitive after-tax yields compared to traditional savings accounts.

Treasury funds typically offer state tax exemptions while municipal funds may provide federal tax advantages, depending on fund composition and your situation. By targeting these opportunities based on your specific circumstances, Smart Yield seeks to maximize your after-tax returns while maintaining liquidity for your cash needs.

Carry Advisors charges a 0.20% annual advisory fee (waived until January 1, 2026) on your Smart Yield assets, calculated daily and withdrawn monthly by liquidating a portion of your investment. Additionally, each money market fund has their own operating expenses (expense ratios) that are deducted directly from the fund’s yield. These fund expenses vary by fund and are factored into the yields we display.

While Smart Yield funds are liquid, there are timing considerations. Money market funds follow standard brokerage settlement processes, typically taking 1-2 business days to settle. Once settled, funds take an additional 3-5 days to arrive in your Carry cash account. The total process from withdrawal request to available cash may take 4-7 business days, so plan ahead if you need funds for near-term expenses.

Our algorithm continuously monitors your Smart Yield allocation based on current yields, your tax situation, and investment amount. We only move your funds when there’s a material improvement in tax-equivalent yield that would meaningfully benefit you. We carefully consider factors like time out of market and transaction costs to minimize unnecessary trading. This balanced approach maximizes your potential yield while avoiding excessive movement. When trades are necessary, they’re executed during market hours and may take several days to implement.

Smart Yield uses the tax inputs you provide—including your state of residence, adjusted gross income, filing status, and household income if filing jointly. Based on this information, the algorithm estimates your federal and state tax brackets to optimize your fund allocation. For the most accurate results, keep your tax inputs current. Note that Smart Yield doesn’t consider all tax factors like deductions, credits, or local taxes, so consult a qualified tax professional for comprehensive tax guidance.

Smart Yield works differently with IRA and Solo 401k retirement accounts due to their tax-advantaged nature. Since these accounts already have special tax treatment, our algorithm bypasses tax optimization and instead focuses on selecting the money market fund with the highest pre-tax yield based on your investment amount. This approach optimizes your potential returns while recognizing the distinct tax characteristics of retirement accounts.

Yes, while the tax optimization benefits may be most noticeable for residents of states with income taxes, Smart Yield remains valuable even if you live in a state without income tax. For clients in states without income tax, our algorithm focuses primarily on selecting the money market fund with the highest pre-tax yield based on your investment amount and other factors. You still benefit from professional management and automated fund selection to help maximize your potential returns. 

Your eligibility depends on several factors including your state of residence and the money market fund composition. Treasury-backed funds may provide income exempt from state and local taxes, while certain municipal funds may be exempt from federal taxes. Our algorithm evaluates these factors based on your tax inputs, but tax rules are complex and vary by state. For example, some states (California, New York, Connecticut) require funds to hold at least 50% in U.S. obligations to qualify for state tax exemptions. For definitive guidance on your specific situation, consult a qualified tax professional.

Smart Yield invests exclusively in money market funds that primarily hold high-quality, short-term securities such as U.S. Treasury securities, government securities, municipal securities, and repurchase agreements. Our current options include funds from Vanguard, Schwab, and other notable financial institutions. All funds are selected based on criteria including fund size, expense ratios, track record, and credit quality. The specific fund selection is limited to those available through our custodian, DriveWealth LLC, and may change over time as we evaluate new options.

Your Smart Yield investments are held with DriveWealth LLC, a registered broker-dealer and FINRA/SIPC member. While money market funds seek to maintain a stable $1.00 per share price, they are investment securities, not bank deposits, and are not FDIC insured. However, your account is protected by SIPC insurance up to $500,000 (including $250,000 for cash) in the event of broker failure. SIPC insurance does not protect against market losses. Money market funds invest in high-quality, liquid securities to help maintain stability, but all investments involve some risk.

Yes, Smart Yield is designed to automatically reinvest all dividend earnings back into the same money market fund where your investment is held. This happens without any action required from you, allowing your earnings to potentially compound over time. You can view both pending earnings and reinvested dividends on your Smart Yield account page.