Money Market

If you want higher interest rates than a typical savings account, but don't want to lock your funds in a CD, a money market account could be just what you need.

What is a Money Market Account?

A money market account is a type of savings account that combines the advantages of a CD with the features of a checking account. Money market accounts generally pay higher interest rates than typical savings accounts and have higher minimum balance requirements. Investors receive a checkbook and are allowed a limited number of penalty-free withdrawals in any given month. Internet Money Market accounts will not offer checks, but will use ACH transfers and a Debit Card for withdrawals from the account.

How Money Market Accounts Work

Funds can be deposited into a money market account just like a regular savings or checking account. The bank then puts your money in short term, low risk investments. In return, you earn an interest rate that may be up to twice as high as a savings account. Interest is usually compounded meaning that you earn interest on the interest you've already earned. This helps your money grow at a faster rate than with simple interest. Interest rates fluctuate depending on market conditions.

With a money market account, you can access your funds at any time. Unlike a CD, your money is not locked in for any specific time period. With a money market account you can usually make six withdrawals per month (three check transactions) and as long as you keep your minimum balance, you won't be charged any fees.

Some money market savings accounts require a large minimum deposit. If you don't currently have a large amount to invest, consider opening an online savings account.

Benefits of Money Market Accounts

• Higher interest rates than savings accounts
• Money can be withdrawn at any time, usually penalty-free (some debit limitations will apply)
• FDIC insured up to $250,000*
• Easy to open up

Most banks, credit unions and mutual fund companies offer money market accounts. Money market accounts, especially those affiliated with online banks, are extremely easy to set up. They are a convenient, safe way to help your money grow, while providing you with access to your funds when you need it. To learn more about money market accounts and how they can work for you, visit iGObanking.com or call us at 1-888-432-5890.

*The standard insurance amount of $250,000 per depositor is in effect through December 31, 2013. On January 1, 2014, the standard insurance amount will return to $100,000 per depositor for all account categories except IRAs and other certain retirement accounts, which will remain at $250,000 per depositor.