What to Look For in a Money Market Account
February 3rd, 2010 Filed under: Uncategorized — Finance AuthorWhat is a Money Market Account (MMA)?
Really quick let me explain these accounts. They are simple cash asset accounts held at banks and investing institutions. They are bank accounts that act somewhat like savings accounts. You can put your money in these accounts and the bank will take that money and will reinvest it with ultraconservative investing techniques. With a savings account the bank can’t decide what to invest your money in. They must follow banking standards. With a money market account, they are allowed to be a bit more flexible. These accounts are considered cash funds.
What Makes Money Market Accounts so Good?
MMAs are great because they are a safe place to keep your investing funds. In most cases, they are backed by the US government with insurance from the FDIC. This means that if the bank holding your funds goes out of business and loses your money. The US government will give you back your money, up to $250k. This is through 2013.
Another reason MMAs are so good is the ability to earn interest on your money. Because the bank is holding your money and is able to invest it, they will let you share in those earnings. This is great because it’s truly passive income. You’re not doing anything to earn this money. Your money is earning more money for you.
Because MM accounts are so simple and there isn’t much work involved, most banks are content to leave you alone and not charge you any money to have the MMA. This means no fees to open up an account, or maintain it from month to month.
Key Features of the Best Money Market Accounts
Knowing all that we’ve talked about so far, it’s easy to determine the key features of some of the best MM accounts: safety, high-interest, and low fees. The best money market accounts are going to have FDIC insurance, pay out high-interest, and not charge you any fees. To see some of the best money market accounts, see the links in the resource area below.
To see more about great MMAs, see my EverBank Review, one of the top money market accounts available today. This article was written by PT of http://ptmoney.com
