What Is a Robinhood Cash Account?

If you have an Instant or Gold account with Robinhood, you can downgrade to a Robinhood Cash account. However, the app doesn’t make downgrading particularly easy. According to some users’ reviews of the Robinhood Cash feature, you might not want to make the switch. Here’s the scoop on this account type. 

According to the company’s support site, a Robinhood Cash account “allows you to place commission-free trades during the standard and extended-hours trading sessions,” but you won’t have access to instant deposits or instant settlements like you would with Robinhood Instant. Robinhood Instant is the free, default account type. Robinhood Gold is the premium account type that offers extra buying power for $5 per month.

Another key difference is that pattern day trading restrictions “don’t apply to users with Cash accounts,” according to Robinhood. With Robinhood Instant and Robinhood Gold accounts, users are generally “limited to no more than three day trades in a five trading day period, unless you have at least $25,000 of equity in your Instant or Gold account at the end of the previous day.” According to Robinhood, pattern day trading rules were enacted to protect individual investors from assuming too much risk.

On the company's support site, Robinhood specifies that users can downgrade to a Robinhood Instant account or a Robinhood Cash account at any time as long as they aren't using any Gold Buying Power.

If you’re using a Robinhood Gold account and you want to downgrade, open the Robinhood app. Tap the Account icon in the bottom-right corner of the screen and click the three bars in the top-right corner of the screen. Then tap Settings, tap Robinhood Gold, and tap Downgrade from Gold. You will be able to downgrade from Robinhood Gold to Robinhood Instant. If you have any issues, try checking out Robinhood’s troubleshooting guide.

To downgrade from Robinhood Instant to Robinhood Cash, Robinhood says to get in touch with the support team to request the change.

Day traders sometimes choose the Robinhood Cash option because Robinhood Cash accounts aren’t subject to the same pattern day trading restrictions as Robinhood Instant and Robinhood Gold accounts.

However, Robinhood users on Reddit have shared their experiences with Robinhood Cash. Many of the reviews are negative. One user complained that Robinhood Cash allowed “no options and getting money into your account takes days.”

Another review said that there’s “zero advantage” to Robinhood Cash. “Cash gives you unlimited day trades but it also holds funds from any sale for T+3 [trade date plus three trading days] which, IMO, makes it fairly useless for day trading unless you’re doing the 1/3rd at a time strategy (which still leaves you fairly inflexible and there’s no reason you can’t do that with Instant unless you just can’t restrain yourself),” the user wrote. “Personally, it was way better for me to just have all my buying power then and there with Instant rather than waiting.”