MUTUAL FUNDS » Best Mutual Funds
Although money market accounts have a similar name to money market funds, they are not the same. To understand money market accounts and money market funds, it helps to know the difference between the two, and to understand what the "Money Market" is specifically. Money Market: Just as a market is a place where goods are bought and sold, the money market describes the market where monies, certificate of deposits, bonds, etc., are the goods banks and financial institutions trade, borrow and lend.
Money Market Account
Money Market Accounts (MMAs) have competitive returns while taking less risk. Money market accounts will be easier to find at standard banks, therefore taking less time and effort. Money market accounts offered by banks are typically FDIC insured. Money market accounts have limited transaction privileges. These accounts are limited to no more than three check-based transactions and six withdrawals or transfers per month. Money market accounts also have a minimum balance requirement.
Money Market fund
A money market fund is a kind of mutual fund. Money market funds typically have to be opened with a brokerage firm or mutual fund company. These funds are collection of short-term debt investments held by a mutual fund. These investments are debt securities that generally mature in 13 months or less. Money market funds commonly have higher returns than money market accounts. Money market funds typically are not FDIC insured.
Which to use will depend strongly on what you need. Depending on your requirements, money market accounts have their place, as do money market funds. If you don't need the options available from funds, you could use a money market account. The main factors are risk and choices. For some investors, safety is more important than high returns. For others higher returns are their focus.
Getting help with investing when trying to play the market can be worth it depending on the person you choose to manage your accounts. Everyone who claims to be an expert is not one but most charge expert money which is why some people decide to simply go at it alone. However, if you are a person who thinks getting help with asset management is the right road to take then you'll want to take heed to a few tips that can ensure that getting assistance with investments, such as CDs, mutual funds, stocks, etc. will be worth it.
Don't confuse the advisor with the manager. While often times, individuals involved in asset management can handle the responsibilities associated with both roles, typically the advisor is the person who will offer advice on which investments to choose from, while the manager will actually be responsible for managing your portfolio. If you're only looking for someone to help you dive in - then an advisor is a good way to go, but if you want someone to take the reigns and guide your investments all the way then it's good to go with a manager.
Try someone who is unbiased. If your goal is to make money, then you want help with investing from someone who has favors. In other words, you don't want a person who has favorites because their favorite picks may not work best for your portfolio. Also, if they tend to be very risky investors they might lose all your money.
Ask for referrals. When you're trying to start out in the market and are looking for the help of a good manager, it's a good idea to ask your co-workers, friends and family for help. Diving in blindly with very little knowledge on investments is not a very smart thing to do. Smart investments require that you get the help of someone who can not only handle your portfolio with care, but also be willing to educate you along the way. This takes a special type of person someone that generally cares about you and that you could recommend to another person. So as you're starting out, don't hold back on asking for referrals to ensure that you find yourself in the right hands.
Find someone good and with reasonable price. In the world of asset management things can get tricky. But if you make an effort to find someone willing to be honest and help you with your investments you are well on your way to a sound financial future.
