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Current money market interest rates

The current average money market interest rate is 0.59%, the highest interest rate is up to 5.00%.

Here are the current interest rates for money market accounts:

• Average APR: 0.59%
• Highest rate: 5.00%

Source: Curinos. Data is as of October 11, 2024. Prices are based on a minimum deposit amount of $10,000.

What are money market interest rates?

Interest rates on money market savings accounts are often referred to as money market interest rates. These earnings are usually credited daily or monthly as a percentage of your savings balance. Money market interest rates change daily. Banks and credit unions that pay tiered interest rates often reserve the best interest rates for the largest balances.

An interest rate represents the income earned solely on your account balance. An annual return that takes compound interest into account is called an annual percentage yield (APY). Compound interest is interest that accrues on the interest you earn.

How does a money market account work?

Money market accounts are interest-bearing deposit accounts that function similarly to savings accounts. You deposit money whenever you have some left over, and the interest increases the longer you leave it alone. These accounts are insured by the FDIC for banks and the NCUA for credit unions up to $250,000 per depositor. Money market accounts offer convenient access to funds, often including checks and debit cards, although you may be limited to six monthly transactions.

Compared to regular savings accounts, money market accounts typically offer higher interest rates. However, they tend to require higher minimum deposits and balances to earn them.

How to open a money market account

Before you open a money market account, you should take some time to find out what different banks have to offer. In addition to looking for the highest interest rates, you should also compare minimum balance and deposit requirements, monthly fees and withdrawal limits. Look for an account that offers competitive rates that you can easily qualify for.

You can usually submit an application for a money market account online or in person at a branch. The application will ask you to provide basic information, including your name, address, Social Security number, employment status and income. You will probably also need to provide government-issued identification. Once approved, you can make your first deposit.

Money market account vs. savings account

Money market accounts function like savings accounts in some ways and checking accounts in others. Similar to savings accounts, money market accounts allow you to deposit money as you wish and earn interest on your savings. Both are highly liquid and secure deposit accounts that may apply withdrawal limits, balance requirements and monthly fees.

Similar to checking accounts and unlike most savings accounts, money market accounts can come with debit cards, checks, or both. This makes them a little more flexible than the typical savings account, but money market accounts can limit transactions and are not intended for everyday use. Money market accounts also typically have higher fees, deposit and balance requirements.

Is a money market account worth it?

A money market account is worth it if you want to save now but have easy access to your cash later. The accounts are safe options for investing money because they are FDIC or NCUA insured and do not lose value. As long as you can meet the deposit and balance requirements to avoid fees and earn interest, you’ll be in good shape with a money market account.

If you can’t meet the requirements to earn the highest interest rates, or if a money market account charges fees that exceed your earnings, an MMA may not be worth it. Explore other savings accounts for smaller balances, or consider interest-bearing checking accounts if you need to access your funds frequently.