Money market accounts are similar to checking accounts, but they allow consumers the opportunity to make returns on deposited money. They are often compared to mutual funds; however, they are considered safer because they keep share prices at $1.
Money market accounts can be acquired through almost any local financial institution. As with checking accounts, opening money market accounts give you immediate and regular access to your funds through a checkbook. Also, they require no minimum transaction amount and allow for fast and easy cash deposits.
Once you invest in a money market account, a money manager will take your cash then invest it in t-bills, bonds, CDs, commercial papers or mutual funds. After interest is earned on your investment, the manager pays you your portion of the earnings. Unlike CDs that have interest rates that mature over time, money market accounts require additional deposits to benefit from higher interest returns.
Money Market Accounts are great ways for people to gain interest on their money. Learn how money markets can help you.