Money Market Accounts offer higher interest rates than general saving accounts. They determine the rate based on the current interest rate in the money markets. Some banks also need a minimum amount balance in the MMA to offer such rates to their users.
Types Of Money Market Accounts
There are a couple of types of money market accounts. The consumer can use anyone that best suits their requirements. Let us have a look at them:
Passbook Savings Accounts
Passbook Savings Accounts are regular saving accounts with no deposits or minimum balance needed. Therefore, the interest rate is generally very nominal for such accounts.
High-Yield Savings Accounts
These are the types of accounts that offer a higher interest rate compared to the standard savings account. In addition, these accounts can involve a minimum deposit. So, overall, the risk factor is low in these money market accounts.
Regular Checking Accounts
This account is the most common type of MMA. You can easily make transactions via cheques, wire transfers, ATM withdrawals, and many more through this. But, the interest rate is very low (sometimes zero) in such accounts.
Certificates of Deposit (CDs)
A Certificate of Deposit is generally a saving account with a duration. This time ranges from months to even multiple years. The amount is locked in the account, and the user gets a higher rate of return for locking their money. However, if you withdraw your money before its expiry, you will be liable to pay the penalty. This penalty generally amounts to losing your entire interest amount.
Benefits Of MMA
MMA offers a higher rate of interest to its users than regular saving accounts. In addition, they are eligible to invest in CDs, commercial papers, and many more assets. These features are not available for the regular saving accounts don’t possess.
These accounts even allow hassle-free transfer of funds between multiple accounts. You can even use the checking account features with some of the MMAs.
Money Market Accounts even offer debit cards to its users that make the job easier for the customers to use their money easily.
In short, MMA has all the features of a saving account but with higher interest rates that attract many people.
Talking about types of money market accounts, you can reach out to CIT Bank for your needs. The bank offers a handsome interest rate to its users and has a very user-friendly interface. CIT Bank offers both long-term and short-term certificates of deposit. The E-Checking service has started rolling out online payments and other checking services through its platform with the introduction of the E-Checking service.