A money market account (MMA) is a place to save money and earn interest while having access to your funds via a debit card and checks. Though not as popular as checking or savings accounts, MMAs offer features that could be a great fit depending on your savings goals.
It’s important to note that money market accounts are different from money market funds, which are a type of mutual fund used for investing.
How To Use a Money Market Account Interest Calculator
This calculator helps you determine how much interest you’ll earn based on your deposit amount, the interest rate, how much you contribute on a regular basis and how long you plan to save.
Here’s how it works:
- Input your initial deposit amount. This is the amount of savings you plan to deposit into your MMA account at the outset.
- Enter your monthly contribution. This is how much you plan to deposit per month. You can enter different amounts here to see how your contributions will affect the interest you earn. You can also enter “0” if you don’t plan to make monthly deposits.
- Enter the APY. The APY, or annual percentage yield, is the interest you’ll earn over the course of a year when taking compounding into account. This rate will be listed on the website of the MMA you’re considering.
- Input the length of time you plan to save. Select “Months” or “Years” from the dropdown menu and enter the number of months or years.
- Click “Calculate” to see the results. Based on the data you entered, you can see the interest you’ll earn, the total amount of your contributions and the total value of your savings, including interest earned.
Try It: Use This Example To Calculate MMA Interest
Let’s say you want to deposit $5,000 in a money market account, and each month you plan to contribute $200. After doing your research, you find an MMA offering 4.25% APY.
You’ll see that after one year, you’ll have contributed $2,400 and earned $263.99 in interest. That will make the total value of your MMA $7,663.99 after one year.
Money Market Accounts: What You Need To Know
An MMA is a type of deposit account that combines elements of both checking and savings accounts. Like a savings account, it’s a place to store money that’s not for everyday use. And like savings accounts, you earn interest on that money. In fact, MMAs tend to offer higher interest rates than regular savings accounts.
However, unlike most savings accounts, MMAs usually come with debit cards and checks, giving you more options to access your money.
Money market accounts are a nice hybrid option if you want to deposit money into a high-yield account without losing the ability to draw from your savings from time to time. Note, however, that there might be limits on how often you can withdraw money, and that MMAs often come with monthly fees or tiered interest rates that require you to keep higher deposits to earn better rates.
What Are the Best Money Market Account Interest Rates?
As of January 2025, the best money market account interest rates are above 4.00% APY. Here are some MMA accounts with impressive rates:
| BANK NAME | APY | MINIMUM OPENING DEPOSIT | MINIMUM BALANCE REQUIRED FOR APY |
|---|---|---|---|
| Up to 3.51% | $0 | $0.01 ($5,000 minimum balance to waive fee) | |
| best money market accounts.
How To Choose the Right Money Market AccountBefore you open a money market account, make sure to do the following: Compare interest ratesThe interest rate, usually listed as the APY, should be one of the main factors you consider. The higher the interest rate, the more you’ll earn on your savings—and the higher the compounding frequency (daily vs. monthly, for example)—the more chances to earn interest. Keep in mind that the highest rates are usually offered by online-only banks. Pay attention to minimum deposit requirementsAn MMA account is a good fit only if you meet the minimum deposit requirements. If you have $5,000 set aside to deposit into an MMA, an account that requires a $10,000 opening deposit is of no use. Research interest rate tiersOften, money market accounts pay tiered interest, meaning the APY will differ based on how much money you keep in the account. For example, an MMA might offer an impressive 4.50% APY, but only for balances above $100,000. Read the fine print to make sure you’ll be able to benefit from the highest rates. Look out for monthly feesThere’s not much sense in choosing an MMA that offers an excellent rate but charges a monthly fee that overshadows the interest you earn. Search for an account that either has no monthly fee or waives a monthly fee with certain requirements––ones you can meet. Make note of withdrawal and transaction limitsIf you plan to withdraw or transfer money from your MMA from time to time, you’ll need to make sure the account you’re considering meets your needs. What are the monthly limits, and do they work for you? Find out about debit cards and checksOne of the main perks of money market accounts is that they tend to come with debit cards and check-writing privileges. If you plan to use a debit card associated with your MMA—or write checks—verify that the account you’re considering offers them. Also, find out which ATMs you’ll be able to use, and if there are any associated fees. Money Market Accounts vs. Savings AccountsBoth money market accounts and savings accounts earn you interest on your balance, are meant to store savings and are insured by the FDIC. However, these two deposit accounts have some notable differences. Here’s how MMAs differ:
These are the best high-yield savings accounts this month. Money Market Accounts vs. CDsCertificates of deposit (CDs), like money market accounts, are FDIC-insured deposit accounts meant for saving money and earning interest. However, CDs are time deposits, meaning the bank holds your money for a fixed period, in exchange for paying you interest. During that time, you can’t access your money without paying a penalty. (No-penalty CDs are an exception.) Money market accounts, on the other hand, make your funds more accessible. Though MMAs aren’t used for everyday spending, you can easily make transfers or withdrawals from your account. Average CD interest rates tend to be higher than average MMA interest rates, but you can find comparable rates with high-yield CDs and MMAs. A high-yield CD is a better option if you want to keep some funds inaccessible for a period of time, whereas an MMA is the more sensible choice if you want to periodically dip into your savings. Frequently Asked Questions (FAQs)Are money market accounts safe?Yes, money market accounts are generally a safe place to keep your money. Unlike investment accounts, there’s no risk of losing your money. As long as the bank or credit union offering the account is FDIC or NCUA insured, your money is safe up to $250,000 per depositor, for each ownership category. Who should open a money market account?If you want to set aside some money for future use—whether that’s for emergencies, a vacation or home repairs—a money market account could be a great option. An MMA is for savers who want to earn a high interest rate, can meet the requirements of the account and might benefit from having a debit card or checks associated with their savings. How much will $10,000 make in a money market account?If you deposit $10,000 in an MMA with a 4.00% APY and make no further contributions, you’ll make $407.42 in interest over the course of one year. Your total balance after one year will be $10,407.42. If you start with the same amount but make monthly contributions of $250, you’ll earn $463.03 in interest over the course of the year. Your total balance at the end of the year will be $13,463.03. What is a good interest rate for a money market account?The best money market account interest rates in 2025 are above 4.00% APY. Depending on the account features, however, the best account for you may not be the one with the highest interest rate. Sometimes, MMAs with high interest rates may require a large minimum deposit or charge a hefty monthly fee, making a different account a better fit.
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