Money Market Accounts Are Worth Considering

Historically, money market rates have lagged behind rates of interest on CDs and different time-deposit investment vehicles. People who have cash in money market accounts usually have it there as a spot to put it in between investments. As an illustration, most people who do have money in a MMA have it in their stock broker account. It is better there than having that unused cash sit and earn nothing like it would be otherwise.

With rates of interest at a near all time low, you may find that a number of the best money market rates are comparable now and ought to be thought of as an alternative to certificates of deposits and Treasury bills. Incredibly, T bills have recently actually paid 0.00% interest for awhile and now pay just over that. Putting your money in a money market account is definitely a wiser decision than that.

With Treasury bills and bank CD’s, you’re agreeing to lock your money up for 6 months, 1 yr, 2 years or some other time period. They offer you no flexibility if you happen to all of the sudden want the cash for some emergency or are wondering will interest rates go up? Money market accounts, on the other hand, will let you pull the cash out at any time with no penalty. This makes them superior to any timed investment, particularly if you can get a comparable interest rate.

Moreover, you might be able to discover a money market account at a financial institution that’s providing an bonus rate for some promotional purpose. If you can find that, you might be able to get as much as a quarter of a percent better rate which, in these times of low rates, is significant. If you are able to get some type of a promotional bonus, the interest you earn with that MMA might even put it very close to the rate you can get with a CD and you won’t have the money locked in for any time period.