Money market account
A money market account is a type of savings account with relatively high interest rates.
A money market account is a high-interest, government-protected savings account typically offered by banks and credit unions. Although other companies may offer money market accounts, only those in banks and credit unions are insured.
Money market accounts typically have a minimum balance requirement, and many earn higher rates of interest for larger deposits. For example, an account holder may earn 1% for a $10,000 deposit, but 3% for a $50,000 balance. They also restrict the number of transfers or withdrawals allowed a month to six, and only three may be checks written against the account.
Money market accounts are ideal places to hold medium-term savings and emergency money, because they combine the liquidity of a passbook account with interest rates that approach those earned by certificates of deposit.
Related Fool Articles
- The Motley Fool's Saving & Spending Center
- Where to Park Your Cash
- Market? Mattress? Neither!
- Wanted: Safe Short-Term Investments
Recent Mentions on Fool.com
- Lilly Underwhelms Investors Again
- 1-Up on Wall Street: Together, "Godzilla" and Heisenberg Will Be a Formidable Box Office Pair
- Key Takeaways From Qihoo 360's Earnings Report
- The Little-Known Way Obamacare Could Revolutionize Insurance
- 7 Simple Questions to Help You Plan For Retirement
- When Should You Begin to Aggressively Pay Down Your Mortgage?