When trying to figure out where to park your savings, you have many options. Among safe investments, a longer-term certificate of deposit might offer the best interest rate. But you might have to pay an early termination fee if you redeem a CD before the maturity date.
The interest rates on high-yield savings accounts can be enticing. But rates on standard savings accounts are usually lower than the best money market account rates. In fact, if you want to keep cash handy and earn at least a modicum of interest, money market accounts — also referred to as MMAs — can be a great option.
Money market accounts and money market mutual funds are two different things. One big difference is that money market funds are insured by the FDIC for up to $250,000 if your bank goes bust. Money market mutual funds, on the other hand, are not insured.
The terms of money market accounts vary among bank offerings. When evaluating the current options, GOBankingRates reviewed factors such as:
- Interest rate
- Minimum required opening balance
- Monthly fees
- Minimum required opening deposit
- Whether online and mobile banking are available
Following is a guide to the top 10 best money market accounts surveyed.
Best Money Market Accounts and Rates
To help you find the best money market accounts of 2016, GOBankingRates did the research for you. Here are 10 banks offering some of the best money market accounts currently on the market, with varying features so you can choose the one that best suits your banking needs.
|Money Market Account||Minimum Opening Deposit||Standard Rate (APY)||Minimum Balance to Avoid Fee||Fees||Online Banking||Mobile Banking|
|Sallie Mae Bank Money Market Account||$0||0.90%||$0||$0||Yes||Yes|
|BBVA Compass Bank ClearChoice Money Market Account||$25||0.85%||$10,000||$15||Yes||Yes|
|Synchrony Bank Money Market Account||$0||0.85%||$0||$0||Yes||Yes|
|Ally Bank Money Market Account||$0||0.85%||$0||$0||Yes||Yes|
|MyCBB Money Market||$100||0.65%||$0||$0||Yes||Yes|
|Waukon State Bank Money Market Savings Account||$100||0.50%||$5,000||$5||Yes||Yes|
|Oconee Federal Savings and Loan Association Money Market Account||$10,000||0.50%||$2,500||$15||Yes||Yes|
|Wanda State Bank Money Market Savings Account||$1,000.00||0.50%||$0||$0||Yes||Yes|
|First Sound Bank Sound Personal Money Market||$100||0.50%||$250||$0||Yes||No|
|Pacific Crest Savings Bank Personal Money Market||$2,000||0.45%||$2,000||$15||Yes||Yes|
|Rates accurate as of Sept. 14, 2016.|
Sallie Mae’s money market account is an excellent choice due to its high standard money market rate and virtually nonexistent fees. It offers one of the best money market rates of 0.9% APY, and there is no minimum opening deposit requirement. No minimum balance is required and no monthly fees apply. Both online and mobile banking are available.
No fee is charged for electronic withdrawals, and money market account holders can write checks directly from their accounts.
Open a new ClearChoice money market account online at BBVA Compass Bank with only a $25 initial deposit and you will earn a standard annual percentage rate of 0.85% APY. However, to avoid the monthly fees — which would otherwise be $15 — you need to maintain an account balance of at least $10,000.
It might be possible to avoid the monthly fee even if you don’t maintain the minimum balance. But to do so, you need to have an automatic, recurring monthly transfer of at least $25 from a BBVA Compass checking account to your savings account when the service charge would otherwise be assessed.
Online, mobile and ATM banking are available. Terms for this money market account might vary depending on your place of residence.
The Synchrony Bank money market account offers a high interest rate of 0.85% APY, plus the advantages of no minimum opening deposit, no minimum balance and no monthly fees. You can withdraw money from your account online, over the phone with a customer service representative, by check or at an ATM.
The Synchrony Bank website includes a helpful interactive calculator that shows how your funds grow over time based on your initial deposit and periodic deposits.
For example, open a money market account with $5,000 and after 12 months, you will have $5,043. You certainly won’t get rich with a $43 gain, but it’s better than letting the money sit and earn no interest at all.
Ally Bank’s money market account is another option with a high interest rate of 0.85% APY and no minimum balance or opening deposit, and no monthly fees.
You can make an unlimited number of deposits, including from the Ally app on your smartphone. There is no extra charge for online banking or mobile banking, checks, a debit card, and postage-paid deposit envelopes.
The Ally website features a calculator that shows how you can estimate your earnings over a 12-month period. For example, if your daily balance in your money market account is $5,000, your estimated annual earnings are $42.68.
You need to deposit $100 to open a MyCBB money market account. However, there is no minimum balance requirement thereafter and no monthly fees. Interest rates are currently 0.65% APY. Interest is compounded daily and credited monthly. You also get to use free online and mobile banking tools.
Waukon State Bank has a few brick-and-mortar bank branches in Iowa. You need to provide a $100 deposit to open a money market savings account. The $5 monthly fee is waived if you maintain a balance of at least $5,000.
The interest rate is currently 0.5% APY. If you maintain at least $25,000 in your money market account, the interest rate rises to 0.6% APY. Interest is compounded monthly.
In addition, you have access to unlimited over-the-counter withdrawals, which is an attractive feature for customers who like to bank in person.
To open a money market account at Oconee Federal Savings and Loan Association, you have to deposit $2,500. As long as you maintain a minimum balance of $2,500, you won’t have to pay the $15 monthly fee.
The interest rate isn’t specified. The website says only that the interest rate is tiered and the break point is $25,000.
Oconee Federal Savings and Loan Association also offers a money market bonus account. The initial deposit is $10,000 and you earn an interest rate of 0.5% APY for the first 180 days after you open your account, provided you maintain a minimum balance of $10,000.
Paper statements and e-statements are available at no additional charge.
An initial deposit of $1,000 is needed to open a money market savings account at Wanda State Bank. The current interest rate is 0.5% APY. If your account balance drops below $1,000, your interest rate falls to 0.4% APY. Wanda does not specify fee information on its website.
The minimum withdrawal from your money market account is $500.
Based in Seattle, First Sound Bank offers its personal money market account that requires a $100 minimum opening deposit. You need to maintain at least $250 in the account.
Interest applies on a tiered basis:
|Balance||Interest Rate (APY)|
|Up to $49,999||0.50%|
|$50,000 – $999,999||0.65%|
|$1 million and up||0.85%|
The initial deposit for a personal money market account at Pacific Crest Savings Bank is $2,000. So long as you maintain a minimum balance of $2,000, you’ll be spared the $15 monthly fee. Interest is compounded daily and credited to your account monthly. Your first order of standard checks is free.
The interest rates are tiered, based on the balance in your account:
|Balance||Interest Rate (APY)|
|$2,000 – $24,999||0.45%|
|$25,000 – $49,999||0.55%|
|$50,000 – $99,999||0.60%|
|$100,000 and up||0.70%|
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.