A money market account is a type of savings account that typically pays a higher interest rate than a standard savings account while still keeping your money accessible. Here’s what you need to know.
How a money market account works
A money market account (MMA) is offered by banks and credit unions and is FDIC-insured up to $250,000. Like a regular savings account, you earn interest on your balance. Unlike a regular savings account, money market accounts often come with check-writing privileges and a debit card — meaning you can access the money more easily than a traditional savings account.
In exchange for these features and typically higher rates, money market accounts often require a higher minimum balance — usually $1,000–$10,000 depending on the institution.
Money market account vs regular savings account
- Interest rate: MMAs typically offer higher rates, though online high-yield savings accounts have largely closed this gap
- Accessibility: MMAs often include check-writing and debit access; regular savings typically don’t
- Minimum balance: MMAs usually require higher minimums; many savings accounts have none
- FDIC insurance: Both are insured up to $250,000
Money market account vs money market fund
These sound identical but are completely different. A money market account is a bank deposit product — FDIC insured, your principal is guaranteed. A money market fund is an investment product offered by brokerages — not FDIC insured, though extremely low risk. Don’t confuse the two.
When a money market account makes sense
- You have a large emergency fund ($10,000+) and want it earning more interest while staying accessible
- You’re saving toward a specific near-term goal (house down payment, car) and want higher returns without any investment risk
- You want check-writing access on your savings for occasional large expenses
The honest reality
For most people, a high-yield savings account at an online bank offers comparable or better interest rates than a money market account — with no minimum balance requirement. Check current rates at both before deciding. The best MMA rate and the best HYSA rate are often within 0.1–0.2% of each other, making the choice mostly about whether you want the check-writing feature.