Best money market accounts of December 2024

What our industry experts are saying

• 

  Greg McBride

• 

  Marguerita Cheng

• 

  Lauren Zangardi Haynes

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Greg McBride

CFA, Bankrate Chief Financial Analyst

Like a rock dropped in the middle of a pond, a Fed interest rate cut will ripple out in all directions. Money market rates will continue to move lower as the Federal Reserve repeatedly cuts interest rates. It will be important to seek out the most competitive offers, as even in a declining rate environment those returns will be ahead of inflation for the foreseeable future.

Marguerita Cheng

CFP, Chief Executive Officer at Blue Ocean Global Wealth

The yields on money market accounts, as well as high-yield savings accounts, will be affected by Fed rate cuts. There’s definitely going to be an impact. The same is true for Treasury bills or CDs, but the effect will be more lagging. It’s important to have both short-term savings and long-term investing. With your short-term savings, the yield may fluctuate based on what’s happening in the world around us, but you need this savings for liquidity and access.

Lauren Zangardi Haynes

CIMA, certified financial planner at Spark Financial Advisors

When the Fed starts to cut interest rates, savers should expect the interest rate they are earning on their high-yield savings accounts, and the interest rates advertised for new CDs, to come down. However, [Fed rate changes] aren’t the only factor that drives interest rates on deposits at banks. These can also depend on a bank’s business model and the need to increase deposits. If a bank needs to increase deposits, they may offer a more competitive interest rate to entice savers to move money there.

• How Bankrate calculates the national average

  In June 2023, Bankrate updated its methodology that determines the national average savings account rates. More than 500 banks and credit unions are surveyed to generate weekly national averages. Among these institutions are those that are broadly available and offer high yields, as well as some of the nation’s largest banks. 

• Get a competitive yield

  There are money market accounts with APYs that are outpacing current inflation.

• Confirm the bank has check-writing privileges

  Check-writing privileges can be a great additional feature that some money market accounts have and savings accounts generally don’t have. Compare savings accounts with money market accounts if you don’t need check-writing privileges.

• Make sure you won’t be paying fees

  Fees will cut into your interest earnings, so make sure you aren’t paying these.

A money market account with a high yield is similar to a high-yield savings account, except it might offer check-writing privileges.

How to open a money market account

A money market may pay a competitive rate and provide some of the key perks of a checking account. Here’s everything you need to know about opening one.

Learn more

• Is a money market account safe?

  Money market accounts are safe at federally-insured banks or credit unions as long as they’re within limits and guidelines. FDIC deposit insurance at member banks, for example, covers up to $250,000 per depositor, per insured bank for each account ownership category. An account at a credit union that’s a member of the NCUA offers the same insurance coverage. Whether your money market account is in a member FDIC bank or member NCUA credit union, your money that’s within limits and guidelines is protected and backed by the full faith and credit of the U.S. government should the bank or credit union fail.
  
  To check whether a bank you're considering is FDIC-insured, use the FDIC’s BankFind tool, which can help you realize if multiple banks use the same FDIC certificate, or NCUA’s Credit Union Locator. Always double-check with the FDIC or NCUA and your financial institutions to confirm insurance coverage.

• How do money market accounts differ from money market funds?

  Money market funds and money market accounts are different products. You’ll find money market accounts at FDIC-insured banks and at NCUA credit unions.

  You’ll likely find money market funds at a brokerage. Money market mutual funds aren’t insured by the FDIC or the NCUSIF at an NCUA credit union. But they’re considered to be low-risk investments that are liquid. Some money market funds may also be exempt from income taxes.

  Both money market accounts and money market funds may offer the ability to write checks.

• Why do money market accounts pay higher interest?

  Generally, a high-yield money market account pays a higher APY than a checking account because banks can assume that your money will be in there for a longer period. You can withdraw from a money market account just like a checking account, although you may be limited to a certain maximum number of transfers or withdrawals per month.

• Are money market rates fixed?

  Most money market rates are variable, not fixed. That means the rate and APY you receive can rise or fall as market conditions change. A fixed introductory APY is the exception. During the promotional period, the fixed yield gives you a certain APY for a specific period of time. You might lose the fixed yield, however, if you don’t follow certain rules. An introductory rate may also require a deposit made with new money, which usually must come from outside the bank.

• Are money market accounts taxed?

  All taxable and tax-exempt interest must be reported on your federal income tax return. Most interest that you receive or that’s credited to an account that you can withdraw without penalty is taxable income in the year it becomes available to you, according to the Internal Revenue Service. Consult with an accountant to answer your specific tax questions.

• Banks we monitor

  Alliant Credit Union, Ally Bank, Amerant Bank, America First Credit Union, American Express National Bank, Axos Bank, Bank of America, Bank5 Connect, Barclays Bank, Bask Bank, Bethpage Federal Credit Union, BMO Alto, BMO Bank, Bread Savings, BrioDirect, Capital One, CFG Community Bank, Charles Schwab Bank, Chase Bank, CIBC Bank USA, CIT Bank, Citibank, Citizens Access, Comerica Bank, Connexus Credit Union, Credit One Bank, Customers Bank, Delta Community Credit Union, Discover Bank, EverBank, Fifth Third Bank, First Citizens Bank, First Internet Bank of Indiana, First National Bank of America, FNBO Direct, Forbright Bank, Golden 1 Credit Union, Heritage Bank, Huntington National Bank, iGOBanking.com, Jenius Bank, KeyBank, LendingClub Bank, Limelight Bank, Live Oak Bank, M&T Bank, Marcus by Goldman Sachs, Morgan Stanley Private Bank, MySavingsDirect, Navy Federal Credit Union, NBKC Bank, Openbank, Pentagon Federal Credit Union, PNC Bank, Popular Direct, Quontic Bank, Randolph-Brooks Federal Credit Union, Regions Bank, Rising Bank, Salem Five Direct, Sallie Mae Bank, Santander Bank, SchoolsFirst Federal Credit Union, Security Service Federal Credit Union, SoFi, State Employees' Credit Union, Suncoast Credit Union, Synchrony Bank, TAB Bank, UFB Direct, US Bank, USAA Bank, Varo Bank, Vio Bank, VyStar Credit Union, Wells Fargo, Zions Bank