Five Reasons to Open a Money Market Savings Account
When you’re trying to save and manage your money, it can be tough to decide the right account to use. Savings accounts are ideal for funds you want to put away for emergency or special purposes, while checking accounts are the way to go for money you’ll spend. But, what if you’re looking for something that will help you save with the flexibility to spend?
Look no further than a money market savings account. These are perfect for funds you don’t need immediate access to but may need to withdraw from in the future. Typically you’ll earn a higher return without the risk of the stock market, or the restrictions of a CD.
Here’s a look at the top five reasons to open a money market account.
When you open a money market savings account at a credit union, it’s insured by the NCUA up to $250,000. This means you can keep a large sum of money in your account without the risk of losing it to a market crash or a poor choice of investment. A person can keep more than $250,000 at any single credit union, as several options are available for additional share insurance coverage for other accounts.
Check out this link to learn more about how keeping your money with a Credit Union is covered by share insurance, and view the video below to learn more about how to estimate how much additional share insurance coverage you can qualify for based on your personal financial situation.
Accessibility of Funds
One of the most attractive features of money market savings accounts is how your funds are "liquid" — they don’t have a maturity date or term requirements. This means you’re free to access money in your account at any time, usually without penalty. You just have to check on the number of allowed transfers or transactions as most financial institutions have a monthly maximum due to federal regulations.
The level of security combined with the ease of accessibility can be ideal if you have occasional, large expenses such as tuition payments, household repairs, or even unexpected medical fess. You’ll simply earn your dividend while waiting for a need to spend.
High Interest Rates
Money market savings accounts offer a rate of return that surpasses your typical savings account. In most cases, the more money you keep in your account, the higher your interest rate is. This is especially beneficial in a rising-rate environment when rates are expected to increase — giving your money the best chance to grow!
Like any other account, money market savings accounts tend to come with other, additional benefits and features beyond the rate you can earn. For example, low to no monthly maintenance fees, free ATM access and more. When shopping around for the right option, be sure to factor these into your decisions.
It’s also important to note that most have a minimum opening balance requirement, and some have fees or penalties if the balance falls below a certain amount. So, be sure to read the fine print and ask questions to ensure you understand the specifics.
Personal Checks and Debit Card Access
Money market savings accounts often offer flexibility in how you access funds. In fact, you can usually transfer funds into your checking account so you can make payments by writing checks or using your debit card. You’re free to use your money in a pinch without any major effort at all!
Whatever purpose you have for your money — whether saving or spending — a money market savings account is an ideal place to keep your funds.
About Susan Gordon
Susan Gordon is our Stratford Branch Manager. With an extensive experience in the financial services industry, Susan is able to provide members with genuine guidance and support to enhance their financial lives. Outside of work she can be found cooking, shopping, rooting for the Yankees, and spending time with family, friends, and her two Shi Tzu’s.