When you think about savings, you probably think about a savings account. Although it is a reliable option for the safe storage of your money, it is not always the smartest. Gone are the days when 10% of the shares were offered. The current average return is 1.4% per year. This means that you can expect a few dollars at the end, and it does not require an annual fee. If you want to use your money, a money market account is a right choice for you, with a higher profit, they can be both risks and opportunities.
Money Market Account Interest Rate
Many people who are interested in opening a money market account are enticed by the interest rate – and this is understandable. In the end, you want your money to work for you more when you save. Money market accounts usually have higher interest rates. This means that you get more if you do the same as keeping money in a classic savings account.
This is because money market accounts are grouped into another fund, which is used by investors to generate higher returns. This more aggressive form of investment can lead to a loss of funds , but it is very unlikely and has not happened so far. Given the low risk, higher interest rates are usually considered a reasonable compromise.
Access To Funds
Another advantage is that you have more access to the money you deposit into it. Unlike a savings account, where you can withdraw money no more than a few times a month. With a Money Market Account you can withdraw or transfer six times per statement. In addition, most banks give you the opportunity to issue checks directly from them. Moreover, in many banks, you can also connect a debit card to your account to facilitate withdrawals and expenses. This provides more flexibility than a standard savings account.
Money Market Accounts give you a much higher level of investment and interest. Annual APY is about 2% or more. The return you can get is much higher compared to mutual funds and exchanges. There are some banks that even offer rewards as a bonus in the first months after opening an account. The monthly balances required to maintain rates are also much lower.
As mentioned above, these accounts don’t lose money. This makes them a safer place to leave their money and at the same time make a reasonable profit. Given the volatility of the stock market, this is by far the best guarantee for saving and building up your funds.
The next time you wonder what a money market account is, you can think of it as a stable alternative to low-risk savings accounts that can be used to conveniently issue checks and at the same time get a competitive rate for your savings. With all these advantages, it is not surprising that cash accounts are one of the most popular financial products of banks.
Remember that interest rates can change daily. Thus, if you find an attractive interest rate on the market account, you should take advantage of higher interest rates when you find them because they may not be available tomorrow.