Cove Capital Liquid Income Review

Cove Capital Liquid Income Ratings at a Glance

Cove Capital Liquid Income Product Offering

Cove Capital Liquid Income (CCLI) offers the CCLI FICA, providing individuals, non profits and corporate entities with a unique financial cash account product with many attractive features. Here's a breakdown of these features. 

Competitive Interest Rate

In savings deposit accounts, the crucial factor is the interest rate, as it dictates your earnings and the speed at which you can achieve your financial objectives. Unlike traditional savings accounts, high-yield cash accounts reward you with a better interest rate. Your earnings grow even faster from compound interest, which lets you earn interest on interest. 

The higher the annual percentage yield (APY), the faster you'll be able to meet your financial needs, whether building emergency funds or making a down payment on a home. According to the Federal Deposit Insurance Corporation (FDIC), the national average APY on savings accounts is just 0.46%, almost 10 times less than CCLI FICA's 4.47%. 

Although applicable to the first $1 million deposit, CCLI FICA's rate is also slightly above what's obtainable among some of the best high-yield savings accounts. For instance, the APYs for Marcus by Goldman Sachs, Ally Bank and Barclays are 4.40%, 4.25% and 4.35%. 

High FDIC Insurance Levels 

FDIC insurance acts as a financial safety net, guaranteeing the security of your funds in case of a bank failure. An illustrative example is the recent case of Silicon Valley Bank, where FDIC insurance played a crucial role in compensating depositors following the bank's collapse. This real-world instance underscores the practical importance of FDIC insurance in safeguarding depositors' interests. 

FDIC insurance serves as a stamp of fund security and protection for member banks. It doesn't just protect account holder cash but also fosters confidence and stability, encouraging individuals to explore higher-yield options without compromising the safety of their funds. With the CCLI FICA program, you benefit from up to $25 million in FDIC insurance per Tax ID, which is 100 times the FDIC insurance limit of many banks. 

This $25 million is spread across a network of 900+ banks in an innovative approach that involves allocating deposits in increments of up to $250,000 per bank within the network. So essentially, one CCLI FICA account grants you access to 900+ FDIC-insured U.S. bank accounts. Higher coverage provides peace of mind, especially for those with substantial funds, such as those selling a business, a home or receiving an inheritance or those corporations or non profits with large balances of cash that they want to protect with FDIC insurance up to $25 million.

Full Liquidity 

CCLI FICA offers account holders total liquidity, allowing them to access funds promptly without facing penalties or restrictions. The deposits become readily available the next business day after account opening. This feature ensures that you can swiftly respond to unexpected financial needs, capitalize on investment opportunities, or navigate life events without sacrificing the attractive interest rates offered by high-yield accounts. The absence of liquidity constraints distinguishes CCLI FICA from fixed-term investments like certificates of deposit (CDs), offering account holders a dynamic and responsive financial tool tailored to the unpredictabilities of life.

Additional Features 

Besides its high APY, robust FDIC insurance and total liquidity, the Cove Capital Liquid Income FICA users benefit from simple and hassle-free online access to account information 24/7 with unlimited transaction capability. CCLI’s FICA streamlined tax reporting process is also noteworthy as account holders are provided only one Form 1099 for simplicity. 

This simplified tax reporting adds to the user-friendly aspects of CCLI’s FICA, ensuring a straightforward and efficient experience for individuals managing their financial affairs. Account holders remain anonymous to the program custodian and the network banks, ensuring privacy and avoiding solicitation.

How FICA Works — Getting Started

FICA's account opening or application process is quick and straightforward, taking less than 5 minutes to complete. To get started, provide your details on the "Sign Up Now" section of the homepage and click "Submit." You'll be provided a link that'll take you to the application pages. Here, you'll fill out your detailed account information, link your ACH or brokerage account and, on application confirmation, proceed to deposit funds. 

At this stage, (the CCLI FICA program administrator) sends instructions to the program custodian and then sends the deposits to the program banks. These deposits are allocated in increments of up to $250,000 per bank per client Tax ID. Your funds are then ready to start working for you safely. The ability to link your CCLI FICA account to multiple bank accounts, brokerage or advisory accounts enhances convenience and financial management.

Cove Capital Liquid Income (CCLI) provides customer support via email and phone — at (855) 564-4109. You can contact the team via these channels to ask questions or get step by step help in setting up your CCLI FICA high yield cash account. Typically, the phone channel is ideal if you need an immediate response to your queries or help in setting up your account. However, the CCLI team is equally responsive when contacted via email. Users also enjoy round-the-clock online access to their account information.  

Cove Capital Liquid Income prioritizes the security of customer's funds and personal data. Through the CCLI FICA account depositors are able to access the security for their funds of up to $25 million dollars of FDIC insurance. CCLI FICA provides clients with access to a deposit platform encompassing 800+ banking institutions across the U.S.

Although CCLI FICA is not a member of the FDIC or National Credit Union Administration (NCUA), the depository banks holding the funds associated with CCLI FICA are FDIC and NCUA members. This membership ensures that the funds deposited in those banks and held within CCLI FICA are subject to FDIC protection, providing safety and security for account holders. Account holders remain anonymous to the program custodian and the network banks, ensuring the utmost of privacy and security.

To protect users' personally identifiable information (PII) and other sensitive data like account numbers during transmission on its network, CCLI FICA employs Secure Socket Layers (SSL) technology. The platform stores all PII collected during account setup on a secure server and uses procedures designed to enhance its protection from unauthorized access, destruction, use, modification or disclosure. CCLI FICA will not share or sell your data to a third party except on consent or in line with judicial precedent. 

CCLI FICA requires a minimum initial deposit requirement of $100,000. A higher minimum deposit requirement is another feature that differentiates HYCAs from HYSAs. Most HYSAs require little to no initial deposit and extend above-average APY to clients, irrespective of the balance in their account or the deposited amount but often are limited in FDIC insurance up to a mere $250k whereas CCLI FICA provides FDIC insurance up to $25 million in cash deposits. CCLI FICA's 4.47% APY only applies to the first $1 million deposits. 

Accounts with deposits ranging from $1 million to $25 million earn a blended rate, which may be lower than 4.47%. Ensure that you contact CCLI directly to ascertain the specific blended rate. CCLI FICA's high minimum requirement of $100,000 and innovative FDIC insurance coverage of up to $25 million suggest that it targets corporate entities, non profits and high-net-worth savers hoping to benefit from the robust protection that comes with depositing a lump sum into this account type while enjoying competitive interest earnings. Like most HYSAs, CCLI FICA charges no account fees. Additionally, there is no transaction limit, and clients enjoy the flexibility of linking multiple bank and brokerage accounts. 

The fast and straightforward CCLI FICA account opening or registration makes for an excellent user experience, especially considering the platform offers clients 24/7 unrestricted access to their account information. Its simplified tax reporting approaches also enhances user experience. Besides the APY and FDIC insurance, other factors that make for an excellent user experience include total liquidity and unlimited account transactions. Benzinga considers CCLI FICA recommendable. 

Cove Capital Liquid Income (CCLI) vs. Competitors

Cove Capital Liquid Income's (CCLI) FICA has many competitors in the high-yield savings market, including LendingClub and SoFi. These platforms slightly edge FICA in APY offering at 4.65% and 4.60%, respectively however are much less secure with only $250k of FDIC insurance per tax payer ID as opposed to the CCLI FICA $25 million of FDIC insurance for deposited cash. These APYs apply to all balances. In contrast, FICA's 4.47% APY applies to the first $1 million deposits. Additionally, FICA has a significantly higher minimum deposit requirement of $100,000 than LendingClub ($100) and SoFi ($0). 

However, unlike both competitors, CCLI FICA stands out by providing up to $25 million in FDIC insurance, distributed in increments of $250,000 across a network of 900+ bank accounts. This innovative insurance offering may appeal to high-net-worth individuals, non profits and corporate entities hoping to benefit from the robust protection that comes with depositing a lump sum into this account type while enjoying competitive interest earnings. Most high-yield savings account platforms, including Lending Club and SoFi, are FDIC members. The implication is that client funds are protected up to the FDIC's maximum coverage limit of $250,000. While CCLI FICA's unique FDIC insurance up to $25 million is its core competitive advantage, its total liquidity is also noteworthy compared to similar products. 

Cove Capital Liquid Income's FICA presents a comprehensive solution for individuals, non profits and corporate entities seeking competitive interest rates, substantial FDIC insurance coverage and a user-friendly banking experience. The combination of a high APY, liquidity and $25 million of FDIC coverage distinguishes CCLI FICA as a viable option in the financial landscape. It is recommended if you can afford the $100,000 minimum deposit, but you must remember that 4.47% APY is applicable only for your first $1 million deposits and can vary over time based on interest rate levels in the general economy, which is the same as all HYSA and HYCA accounts in that rates can go up and rates can go down. Undercapitalized savers seeking passive income via interest earnings can consider some of the best high-yield savings account options with no minimum deposits, zero fees and an equally competitive APY however they will be subject to only $250k of FDIC insurance as opposed to CCLI FICA’s $25 million of FDIC insurance. 

Frequently Asked Questions

Disclosure: All information contained herein is for informational purposes and should not be construed as investment advice. It does not constitute an offer, solicitation or recommendation to purchase any security. Some information contained in this fact sheet has been obtained from sources believed to be reliable, but it cannot be guaranteed by StoneCastle, Cove Capital Liquid Income, LLC or any of their affiliates.

StoneCastle and Cove Capital Liquid Income, LLC are not a bank, nor does it offer bank deposits and its services are not guaranteed or insured by the FDIC, NCUA or any other governmental agency.

FICA satisfies the FDIC’s requirements for agency pass-through deposit insurance coverage. Program banks in the FICA network are FDIC-insured “banks” and “savings associations” as those terms are defined in the Federal Deposit Insurance Act.The current FDIC Limit is $250,000 per depositor per bank.The NCUA operates the National Credit Union Share Insurance Fund (NCUSIF) to protect accounts at federally insured credit unions up to $250,000.

FICA is not a member of FDIC or NCUA, but the depository banks where your money is placed are FDIC and NCUA members. FDIC and NCUA are independent agencies of the U.S. government that protects the funds depositors place in FDIC and NCUA insured institutions. FDIC and NCUA deposit insurance is backed by the full faith and credit of the U.S. government. Funds may be submitted for deposit only after a depositor enters into a FICA agreement. The Agreement contains important information and conditions regarding the depositing of funds.

*Minimum initial deposit subject to change. After initial deposit requirements have been met, deposit balances, as the result of withdrawals/transfers, may go below the required minimum initial deposit requirement.

CCLI and StoneCastle are separate entities. StoneCastle being the program administrator has sole responsibility of deposits and program mechanics. CCLI is acting on an introductory basis only between you and StoneCastle. For this introduction, StoneCastle will pay CCLI a fee based on the amount you deposit into the program.

1 APY is effective as of September 5, 2023 and is earned on the first $1 million. Accounts with deposits between $1 million and $25 million will earn a blended rate which may be lower and is subject to change. Please contact CCLI to determine blended rate. Current yield and maximum deposit insurance coverage is indicative for FICA and may be lower or higher than what is stated due to changes in market or business conditions. Please contact CCLI for the most current yield and maximum deposit insurance coverage as they may have changed since the date of this fact sheet and website. FICA yield is the APY (annual percentage yield) based on APR (annual percentage rate) for the period indicated as reported by StoneCastle. The Annual Percentage Yield (APY) paid by program banks is subject to change at any time at the program banks’ discretion.

2 FDIC.gov, February 1, 2023. National rate is calculated based on the simple average of rates paid.

3 Liquidity is ordinarily available on a next business day basis. Same day purchase credit and next day liquidity redemptions are subject to a 3:00 PM ET cut-off. Please carefully read the current FICA Program Terms and Conditions for more complete information and the governing terms of the account (including liquidity, fees, terms, etc.). This can be found at stonecastle.advisor.cash.

4 Balances held in client Custody Accounts may not receive FDIC and NCUA insurance. If you have any cash at any depository institution that is in the bank network then you may not receive full FDIC or NCUA insurance coverage on your deposits at those institutions. This material is not to be considered tax or legal advice. Please speak with your CPA and attorney for guidance regarding if the this Program is appropriate for your particular situation. FICA® is a registered trademark of StoneCastle Cash Management, LLC.