Max is designed to help you earn the highest yield each month, while also maximizing FDIC insurance coverage by helping you spread your cash across your own bank accounts. The process of helping you reallocate your cash among your accounts in an optimal manner is called an optimization.
Max’s optimization calculation helps you “waterfall” your cash across your accounts in an optimal manner, so you can fill your highest-yielding account up to the FDIC insurance limit (or any other limit you have set) and then move any excess funds to your next-highest-yielding account, and so on until all your cash has been allocated. Lower-yielding accounts are kept funded with a minimum balance of $1.00 so that they remain open and can be ready to receive funds if/when their rates become more competitive.
During each optimization, Max first retrieves current balance information for each of your high-yield savings accounts and the checking account shown in the top-left of your Max Dashboard.
Max then compares how your funds are allocated vs. Max's optimal allocation model, taking into account current interest rates, the FDIC insurance limits (or any other per-account limits you have set), and the amount you wish to keep in Max Checking or your existing, supported checking account (your “target balance”). If any of your cash could be more efficiently allocated, Max will propose to you an optimal re-allocation of cash, and then send your funds transfer instructions to your banks on your behalf.
During your optimization, Max will also take into account your target checking account balance, as described below:
- If, at the start of your optimization, the checking account balance shown on your Max Dashboard is below the target balance you have set for this checking account, Max will propose that you transfer funds from your lowest-yielding online savings accounts to your checking account to top up the balance. These transfers typically take 2-3 business days for your banks to complete.
- If the checking account shown on your Max Dashboard has funds in excess of your target balance, Max will propose that you transfer funds from this checking account to your higher-yielding online savings accounts, where you can earn more. These transfers typically take 2-3 business days for your bank to complete.
You can track the status of your optimization by clicking on the word "Optimizations" at the top of your screen (or, if you’re using a mobile device, in the menu bar) and then select the date of your most recent optimization. You will then see a diagram illustrating each of the requested funds transfers, as pictured below:
During the funds transfer process, the portion of your funds that are being transferred may be unavailable for 1–3 business days as they move from one bank to another via the ACH network. All funds transfers are managed by your existing banks; Max never takes custody of your funds.
Note: If you are using Max Checking, any external funding accounts that you have linked to Max will not be factored into your optimization calculation. To send a regular amount of money to Max Checking (or to set up a monthly “retirement paycheck” from Max), use your bank’s online banking portal to link your Max Checking account as an external bank account and set up recurring transfers.