Money Market Accounts

A money market account (MMA) is a lot like a savings account, but with different guidelines and restrictions. There’s a higher minimum deposit, starting around $2,500. Withdrawals are limited to an average of three to six per month. The good news is that their interest rates are typically higher than with a savings account. And these days, many MMAs will let you write checks from them.

Here are some things to consider before opening a money market account:

• What are the specifics? Find out how large the minimum deposit is and what fees or transaction limits come with it.
   
• What is the interest rate? For most MMAs, the more you save, the higher the rate. Research what their tiers are, it might be worth it to put a bit more in to get a higher rate. Plus, the interest is compounded, which means that the interest you make one month will be gaining interest of its own the next.
   
• Are my savings safe? Like with other accounts, MMAs should be federally insured. At a credit union, look for the National Credit Union Share Insurance Fund (NCUSIF).

Not sure if you should be saving or investing? We have a Saving vs. Investing page to help you decide. Or take a look at our savings calculator to see if MMAs are for you. Still deciding when and how to save, Savings 101 can help guide you.