Anyone that has extra cash and wants to earn interest money on it may consider opening a money market account. Money market rates aren’t too terribly impressive right now, however compared to the national average of savings accounts, opening a high yield money market account is well worth the few minutes it takes to sign up. Money market accounts allow you to earn more interest than you otherwise would just holding onto your money, and they’re risk free!
Currently, the highest money market interest rates will produce a return of between 1 to 1.15% percent interest per year. Depending on which money market account you choose to open, you may have a minimum deposit which you are required to maintain to receive the highest interest rate on your money market possible. Be sure to check on the monthly fees, and limit the number of transactions from the account. Money market accounts are more like checking accounts than savings accounts, however the number of withdrawals are still limited. With some money market accounts, however, you can make an unlimited number of withdrawals from your account using your debit card.
Online Money Market Rates
Online money market rates offer a snapshot of what kind of rates are currently available. Many of the banks and credit unions may provide you with better rates and less or no monthly fees than what you can find locally. This is why it is so important to compare rates and to work with multiple banks to find the money market account that is ideal for your situation. Check on the reputation and history of the lender before choosing to select an account based only on their money market savings rates. In some cases they may not be insured by the FDIC and this provides you with little or no protection at all in the event that the lender fails. Always seek out a lender that is backed by the FDIC or the NCUA to secure your investment.
Finding the best money market rates comes down to understanding what your needs are and doing some research. RateCatcher.com makes that research easier. Check out the money market rates chart to find the highest rates available throughout the country today. If you continue to deposit money into your money market accountand you do not withdrawal money from the account, you will see your account accumulate. Use the savings account calculator to see how much money you will receive with the current highest interest rate in the time you plan to leave your money in your account.
Money Market Funds
Money market funds work differently from regular accounts like savings accounts. You put your money in a money market fund and your money will be invested by the bank or credit union as they see fit to invest it. Your money is normally invested into various securities. The securities that the bank or credit union chooses to use will impact the money market account rates and just how much money you will be able to earn. Most money market fund accounts are not backed by the FDIC so it is important to carefully weigh your decision if you are considering this investment over a money market account. Banks use the money to invest it into moderately risky, but higher return investments like treasury bills and this is why they can pass along the higher interest rates to their customers.
Money market account rates are based on APY. The APY is annual percentage yield, this is what rate you are actually making. Most money market accounts are compounded daily and credited to your account monthly. Depending upon the bank or credit union you choose to work with can make a big difference in the returns you receive. Find the money market account that fits you best and offers the highest APY available.
Compare the very best money market rates on the money market comparison chart.
