What Is A Money Market Account And Is One Worth Having?

By Aaron Sarentino Reviewed by Nima Vahdat Updated Oct 17, 2023
What Is A Money Market Account And Is One Worth Having?

A money market account is a type of interest-bearing account offered by banks and credit unions.

If you’ve shopped around for a bank account lately, you’ve likely noticed you have many options, including a Money Market Account (MMA). 


  • Money market accounts are a cross between a checking and savings account
  • Money market accounts include checks
  • Most MMAs pay higher interest rates than savings accounts

What is a Money Market Account?

Money market accounts are interest-bearing deposit accounts at banks or credit unions. They are similar to savings accounts but have some similarities to a checking account. 

Additionally, they are typically a safe place to deposit funds, especially if you have a large amount of money to deposit, as they often earn higher interest rates than traditional savings accounts.

You can access funds in an MMA easier than a savings account and usually earn higher interest rates than standard savings accounts.

How do Money Market Accounts Work?

A money market account is a combination of a checking and savings account. They offer the best of both worlds for each type of account.

Like checking accounts, you can write checks and use the provided debit card to purchase or withdraw cash. 

However, unlike most checking accounts, there may be a limit to how many times you can write checks or withdraw cash. The point of an MMA is to earn compound interest and grow your funds. If you need frequent access to the funds, a checking account is a better option.

Money markets are also like savings accounts because they pay higher APYs than checking accounts, so the funds you leave deposited earn interest. 

Also, like savings accounts, they have withdrawal limits because banks use these as deposit accounts versus spend accounts, like savings accounts.

However, unlike many checking or savings accounts, there are often minimum balance requirements to earn interest. 

Some accounts, for example, pay a lower APY on balances below a specific threshold, or a bank may revert your account to a standard savings account if you can’t meet the minimum balance requirements.

Are Money Market Accounts Better than Savings Accounts?

Many people wonder if a money market is better than a savings account, but it depends on what you want from the account and if you can meet the stricter requirements of a money market account. For example, you’ll likely need to maintain a higher balance to keep the account.

If you have the money to deposit and can maintain the balance, it often pays to put your money in a money market account to earn more interest.

Whether you choose a savings account or MMA, the key is to open one at an FDIC-insured bank. Since you can find many opportunities for money market accounts online with high APYs, it’s important to ensure the bank is FDIC-insured to protect your investment.

Pros And Cons Of Money Market Accounts

As you learn the answer to what is a money market account, it’s important to look at the pros and cons of the account. Here’s what to consider…


Higher interest rates: Many banks pay much higher interest rates on money market accounts than savings accounts if you can maintain the higher required balance. Like any bank account, though, always shop around, as each bank has different rates and fees.

Check-writing abilities: You can access your funds easily by writing a check or making a purchase with your debit card but still earn interest. Each bank has different requirements regarding how many checks you can write, so always check with the bank.

FDIC insurance: Most banks are FDIC insured and protect your funds up to $250,000 per depositor. Only invest your money with FDIC-insured banks.


High balance requirements: Most banks set high minimum balance requirements that you must meet if you want to earn interest on a money market account. These balances can be hard to meet, leaving you with much lower APYs than you thought.

Transaction limits: Most banks have a limit on how many withdrawals you can make from your MMA by writing checks or using your debit card. Know the limits before choosing an account.

High fees: Some banks charge high fees for money market accounts. You should be able to get around them, but only if you meet the bank’s requirements.

How to Choose the Right Money Market Account

Choosing the right money market account is the key to reaching your financial goals. Whether you’re saving for debt consolidation or have another goal in mind, the more interest you earn, the faster you’ll achieve your goals.

Here’s how to choose the right money market account…

Determine how much you can deposit.

The amount you can deposit will determine which account is best. Some banks have much higher deposit requirements than others. Knowing how much you must deposit can help you look at the right accounts.

Compare interest rates at different banks.

Each bank pays different interest rates; some may vary based on the different tiers. Look at what each bank offers compared to how much you can deposit to determine which bank is right for you.

Look at monthly fees.

Some banks charge monthly maintenance fees. Compare what they charge and if there is a way to avoid the fee, such as meeting a specific balance threshold. Your goal should be to find a bank that doesn’t charge a monthly fee to keep more money in your pocket.

Consider account restrictions.

Each bank has different rules regarding what you can and cannot do. Read the fine print, determining how much you can withdraw, how often, and what balance requirements you must meet.

Using these steps, you can find the MMA that best suits your needs and helps your money grow the fastest.

Final Thoughts On Money Market Accounts 

Now that you know the answer to what is a money market account? You may wonder, “Should I open one, or can I do without?”

Before opening a money market account, consider your goals for your money. 

Will you need it frequently, accessing it often via check or debit card? If so, it may not be the best choice. 

If you can leave it, saving the money for a financial goal, like paying off debt or for a large purchase, then a money market account can be a great way to grow your funds faster.

At Americor, we understand the importance of managing your finances wisely. 

If high-interest debts are impacting your savings and financial well-being, explore our debt relief solutions, including debt settlement and debt consolidation, to regain control of your financial future.

If your debt has become unmanageable and you have difficulty making your debt payments each month, then you should consider negotiating a debt settlement and an affordable payment plan that suits your budget.

Talk to one of our certified Debt Consultants, for free, who can provide personalized advice tailored to your specific needs.

By taking proactive steps, you can put an end to your financial stress and work towards a brighter financial future. Remember, there is always hope for debt relief, and our team of experienced professionals are ready to guide you on your journey to regaining control of your finances.

For more information on Americor’s debt relief services, contact us today to see how we can help you eliminate your debts, and get on the fast-track to becoming completely debt-free!


Aaron Sarentino

Aaron oversees executive, administrative and management functions for the firm. Aaron has a Bachelors in Business Administration from Pepperdine University. He is responsible for helping customers at every stage of the debt settlement process and focused on building loyalty to ensure long-term client retention by addressing customer issues. Aaron plays a pivotal role in the upliftment of the Americor team to ensure the best possible customer experience for clients.