Welcome to Money Market Savings Account

Do you want to open a savings account but you feel that a regular savings account may not provide you with sufficient interests?

If you have minimal amount of money but you want it to earn as much interest as it could. Then, you must look at money market savings account.
Money market savings account is a savings account, which will earn interest more than it will if you deposit your money in a regular savings account.

There are however limitations to the number of deposits or withdrawals you can make in a money market savings account. However, limitation as they are, the bottom line is that your money earns you more in terms of interest as compared to a regular savings account.

It will however help you to know that money market saving accounts are not limited to credit unions. Banks likewise offer money market savings accounts but of course, you have to check the offer and the possible interests.

In this page, we will discuss a bit about money market savings account as compared to regular savings accounts.

To start with, a money market savings account earns interest on a daily basis and it accumulates as your money stays in the credit union or banking institution.

Comparing the interest your money will earn in a regular savings account, the maximum your money will earn in a regular savings account is limited to a monthly interest usually pegged at 1%. Some regular savings account may however not provide an interest at all.

The second difference is probably on the number of withdrawals you can make on a monthly basis.

Usually, in a money market savings account, there is limit to the number of withdrawals you can make each money. Likewise, withdrawal may have a corresponding charge per transactions.

Comparing it to a regular savings account, you have no limit in the number of withdrawals and there is no charge in withdrawing from your regular savings account.

Both money market savings account and regular savings account will have a record, which you can update every time you make a deposit or withdrawal. There is a corresponding monthly statement of account that will be provided by the bank or credit union. You may use it to check the accuracy or your record or the statement of account. It will help you understand how your money moves and how it grows.

However, because different institutions vary in rules, charges and interest computation in their money market savings account. It can be difficult for an ordinary individual like you to find the most beneficial instit6ution, thus we create this website to provide your information and choice of financial institution.

Otherwise known as MMDA, a money market deposit account is a kind of savings account that fetches higher interest rates than the traditional savings accounts. This kind of an account is being promoted by many financial institutions and banks and is insured by the federal government. The good thing about such an account is that the money that is deposited is available for withdrawal at any given time unlike other high interest deposit accounts that require you to lock the money for a particular period of time with the bank or financial institution.

A money market deposit account has quite a few advantages over traditional locked in deposit accounts. Let us understand what these benefits are.

a)      There are situations when we receive proceeds from a sale of property or return on earlier investments. In the earlier times one had to deposit this money and lock it for a certain period of time. However, now an MMDA account is ideal for depositing the proceeds since it earns you interest till such time you decide what to do with this money.

b)      The good thing about MMDA is that there are a wide range of banks and financial institutions that offer this product. As a customer, you now have the opportunity to scout around and see who is offering you the best rates and then decide.

c)      Another benefit with an MMDA is that you can access your money whenever you want, just like your normal savings account. Further, there are no penalties for withdrawing such amounts.

d)      An MMDA is very suitable for people who are regular market investors since you can make payments on your investments from this account and at the same time earn interest on the existing balances.

Finally, a money market deposit account is very ideal for people who have retired and are looking for safety of funds, higher interest rates and immediate withdrawal facility on their deposits.

One of the most safe and secured investment and the highest profit yielder is the money market investment.

You are basically investing in short term government securities and deposits which have a typical maturity period less that a year. This period can vary between 3 and 12 months. These are the high liquid Government and Corporate debt instruments. Instruments such as treasury bills, bankers’ acceptance checks, promissory notes, etc. are some of the mostly traded securities in money markets.

You can invest in the Certificate of Deposit (CoD) which are time deposits normally offered to investors by the banks, credit unions and thrift institutions. There are the Repurchase Agreements which are sold to the investors with an agreement to repurchase them at a fixed price on a fixed date. They are short term credits normally for 2 or 3 weeks and sometimes for a day. You would find Commercial Paper which is an unsecured promissory note with a fixed maturity of 270 days and is sold at a discount from face value.

Treasury bills are also very famous in the money market investment. They are short term debt obligations which mature in three to twelve months and are the fastest liquidated bills or securities. The other is the Federal agency short term securities which are issued by Government sponsored companies within the purview of the Federal government.

Federal funds are those where institutions can borrow and lend on an overnight basis for a federal fund rate. These are interest bearing deposits held by banks and other depository institutions at Federal Reserve.

The other kinds of investment are Municipal notes which are short term notes arranged by the municipalities in order to encourage timely tax receipts and other revenues. There are short lived mortgage or collateral or asset backed securities issued with the help of a security.

The fastest way of earning easy money is investing in the high interest money market accounts. It is a good way to earn money while you save a lot of interest on your investments.

The main advantage of these short term investments is that your money is absolutely safe and that it is managed by the financial institutions which are governed by the Federal Reserve. These institutions are highly rated companies and government agencies which are in the business for quite a long time.

You can easily make a potential 2 to 5 percent of profits per year on your investment. The strategy behind the investment is that it is conservative and usually meets the short term debt obligations. The investors can opt for open ended investments which mean they can add and withdraw funds from their money market as and when they want without any kind of additional charges.

The high interest money market accounts carry a very low risk profile along with them. You would come across very rare scenarios where there is a loss or there have been fluctuations in the interest rates. Wherever you hold an account make sure, the bank has a good history. The disadvantage is that if the company in which you are investing goes bankrupt then your money will not come back. This is because these short term investments are not FDIC insured.

These accounts are holding places for cash to be invested. The cash is usually converted from sale of stock, mutual funds, bonds, direct investments, etc. If you have any other accrued interests and dividends this cash is also added to the investments. The benefit of having the money market accounts is that the amounts get transferred automatically. These accounts require higher initial deposits than a normal bank savings account but they will yield higher profits.