When searching for a savings account you might stumble across listings for Money Market accounts, products that are similar to savings accounts but come with a few differences — including higher interest rates, in many cases.
First, evaluate your banking needs to determine whether a Money Market account is right for you. While Money Market accounts sometimes fall under the savings umbrella, they differ in some ways.
Money Market accounts typically earn greater interest than savings accounts, recent fluctuations notwithstanding. They allow you to write a preset number of checks per month from the account. For the additional flexibility you might need to pay a small monthly fee or meet monthly account activity requirements.
If you’re interested in shopping for a Money Market account, check out the following account options:
EverBank offers an extremely competitive interest rate of 1.26% on its Yield Pledge Money Market account. The account requires a $1,500 minimum initial balance and a monthly minimum of $5,000 to avoid an $8.95 monthly fee. Although this account might not fit your needs if you don’t want to deposit a relatively large amount of money. If you are willing to make a decent-sized deposit, you’ll earn an APY nearly three times the national average.
EverBank is a Jacksonville, Fla.-based institution that operates through in-person branches and a heavy online banking presence.
If you’re looking to avoid monthly fees by opening a Money Market account at a purely online bank, Ally could have an account for you. Ally’s Money Market Savings account comes with a 1.24% interest rate, which is among the highest available. The best feature of Ally’s account is its lack of monthly fees and balance requirements. You don’t need to deposit a particular amount to open your account or meet monthly minimum balance requirements to earn the account’s stellar rate. You can make up to six withdrawals per statement cycle from your Ally account.
Ally is one of the nation’s largest online banks. Formerly known as GMAC, Ally Financial is headquartered in Detroit, Mich.
Why would you choose a Money Market account that yields one-third as much as EverBank’s or Ally’s? If you’re looking for the convenience of omnipresent bank branches and the sense of security that comes with banking with a big institution, you might opt for Bank of America’s Growth Money Market Savings account. Bank of America’s highest APY Money Market only requires a $25 initial deposit, but you must carry at least $5,000 in the account to avoid a $10 monthly fee. The account also comes with higher-than-average bank fees, from $35 overdraft and return deposit fees to a $30 stop payment fee.
The main positive of opening a Money Market account with sub-average rates at Bank of America is the added convenience of having branches on what seems like every corner. A Money Market account typically does not require as much fine-tuning as a checking account, however, so this might not be a big issue. Bank of America, based in Charlotte, N.C., is one of the nation’s largest financial institutions and maintains nearly 5,000 branches.
Looking at the 0.01% APY on Chase’s Money Market Savings account, it’s easy to see why online banks such as Ally are popular places to put money. Chase offers the benefit of thousands of branches across the U.S. at the cost of quite a bit of interest. Other concessions you’ll have to make in the name of convenience: Paying steeper-than-average overdraft and wire transfer fees. If you have a preexisting relationship with Chase, it might be worth opening a Money Market at the bank to consolidate your accounts, but when the account yields barely more than a standard checking account, what’s the point?
Chase Bank is one of America’s biggest banks, with more than $2 trillion in assets and locations in metro areas around the nation.