How Do I Pick a Money Market Account?

If you have a significant amount of cash to stash, a money market deposit account might make sense. It's better than putting it on a racehorse or storing it under your mattress. Depending on the particulars of the account, a money market account can serve you well compared with a general savings account, checking account or certificate of deposit.

Ensure that the amount of money you have is appropriate for a money market account. A vast majority of money market accounts require that you maintain a minimum balance. If you don't, your bank will charge you a fee. Minimums vary from firm to firm, but minimums of $25,000 or more are not uncommon.

Shop around and compare interest rates. Generally, the more money you have to invest, the better the interest rate you can receive with a money market account. Often, money market accounts offered by brokerages in conjunction with a brokerage account or money market accounts provided by wholly or primarily online banks offer slightly better rates than ones put forth by traditional brick-and-mortar banks. The former can market more competitive rates because they have lower overhead than banks with lots of branches.

Evaluate the ways and the frequency with which you can access your money. Most money market accounts provide check-writing privileges and ATM access. The catch, however, is that you'll pay a fee if you exceed a certain number of monthly transactions.


  • Money market funds are distinct from money market deposit accounts. A money market fund is a mutual fund that holds low-risk investments. Unlike a bank money market deposit account, money market funds are not FDIC-insured and, although they generally don't, they can lose value.
  • If you don't have enough money to meet the minimum balance requirement of a money market account, consider a simple savings or interest-bearing checking account. If you don't need access to the cash, a certificate of deposit, particularly one with a long term, should provide a better return, but you'll pay a penalty for early withdrawal.

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About the Author

As a writer since 2002, Rocco Pendola has published numerous academic and popular articles in addition to working as a freelance grant writer and researcher. His work has appeared on SFGate and Planetizen and in the journals "Environment & Behavior" and "Health and Place." Pendola has a Bachelor of Arts in urban studies from San Francisco State University.