When considering ways to broaden your financial portfolio, you might come across money market accounts. What is a money market account? Money market accounts are high-yield accounts offered by banks and credit unions that are like a hybrid of a savings account and a checking account. Money market accounts pay better interest rates than a typical checking or savings account, but have certain restrictions. For example, you cannot make more than six withdrawals or payments per statement cycle by check, debit card, draft or electronic transfer from your money market account, and you’ll have limited check-writing ability from the account.
To find the best money market account for you, you’ll want to compare rates, minimum balances and other features. Read on to learn more about money market accounts and discover the banks that offer the best money market rates.
Banks With the Highest Money Market Rates
To determine which money market account might be best for your situation, check out the details on these accounts that offer the highest money market rates:
Highest Interest Rate: Sallie Mae and Able Banking
Like the Able Banking money market account, the Sallie Mae Money Market account pays 1.30% APY. Although Able Banking has a $250 minimum deposit to open an account, Sallie Mae has no minimum deposit and no maintenance fees. Note that neither bank is not a brick-and-mortar bank, meaning it has no branches and all banking is done online.
Best for the Charitably Inclined: Able Banking
Able Banking, an online-only bank, offers one of the accounts with the highest money market rate at 1.30% APY. To open the account, there’s a $250 minimum deposit requirement, but the balance to earn interest is only $0.01.
When you open a money market account, the bank will donate $25 to the 501(c)(3) charity of your choice. Refer a friend who also opens an account, and the bank will donate another $25 to the charity, in addition to donating on behalf of your friend.
Good for Mobile Banking: Capital One
Capital One’s account is near the top of the list for the best money market interest rate at 1.20% APY. No fees are charged, but if your balance falls below $10,000, your interest rate drops to 0.60% APY. Features include a mobile banking app and remote deposit so you can deposit checks by just taking a picture.
Good for High Balances: iGoBanking.com
The GOmoneymarket account pays an interest rate of 1.10% APY, which is within the top three highest rates offered. One possible drawback is that you must deposit at least $25,000 to open the account and begin earning interest. Also, if your balance ever falls below $25,000, the interest earnings stop.
iGoBanking.com might be inconvenient for some people because it is an online-only bank. It does offer impressive mobile banking technology, however, including support for the Apple Watch and Android Wear. The bank also offers Popmoney, which lets you send money to another person digitally.
Check Out: 11 Best Money Market Accounts and Rates
Good for Online Banking Tools: Bank of Internet
Bank of Internet’s Money Market account pays 1.05% APY with no monthly maintenance fees and no minimum monthly balance requirements. Its online banking tools include online bill pay, remote deposit capture and money management software FinanceWorks.
Best for ATM Users: Discover Bank
The Discover Bank Money Market account pays interest of 1.01% APY on balances under $100,000 and 1.05% APY for balances over $100,000.You can access your money at one of over 60,000 free ATMs or via debit card or check.
Discover Bank charges a minimum balance fee of $10 if you don’t have $2,500 in your account, but it waives the fee for the first three months you have the account.
Best for Fluctuating Balances: Ally Bank
Another online bank, Ally Bank, offers a money market account that pays APY on all balance tiers. No minimum amount is required to open the account or earn interest. The account also includes an ATM/debit card you can use for free at any Allpoint ATM.
Best Introductory Rate: EverBank
EverBank offers a higher introductory interest rate for the first year of 1.31% APY, which drops to 0.86% APY at the end of the introductory period. EverBank guarantees, however, that its interest rate will never fall below the rate paid by the top 5 percent of competitive banks. One possible drawback of this account is the $5,000 minimum required to open it.
Find Out: What Is a Business Money Market Account?
Best for Low Balances: Synchrony Bank
The money market account from online bank Synchrony Bank pays 0.85% APY. No minimum balance is required, and there’s no monthly maintenance fee. You need just $250 to open the account.
Best for Flexibility: AloStar Bank of Commerce
AloStar Bank of Commerce prides itself on its flexibility and competitive rates. Its money market account requires $100 to open and offers a rate of 0.50% APY. A $1,000 balance is required to earn interest. If your daily balance falls below $1,000 or your average daily balance falls below $5,000, you’ll incur a $10 monthly service fee.
Remember that money market rates change frequently. Compare rates periodically to make sure you’re still getting the best rate for you.
Rates are accurate as of Oct. 2, 2017 except for Ally, whose rates are accurate as of today.
GOBankingRates is a personal finance and consumer interest rate website owned by ConsumerTrack, Inc., an online marketing company serving top-tier banks, credit unions, and other financial services organizations. Some companies mentioned in this article might be clients of ConsumerTrack, Inc., which serves more than 100 national, local and online financial institutions. Rankings and roundups are completely objective, and no institution, client or otherwise, paid for inclusion or specific placement. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone and have not been reviewed, approved, or otherwise endorsed by the companies included in the article.