How to Shop for Money Market Accounts?

When you open a money market account, as the song says, you’d better shop around. On any given day, certain banks may try to attract deposits. Those banks often offer money market accounts that yield over 5%, although the average yield nationwide is more in the range of 2.5%. In many cases, the yield also depends on the amount you deposit. The first step in opening a money market account is to decide which type best suits your needs. Money market accounts come in three types:

• The basic money market account: These usually require a minimum opening deposit of $ 100.
• The “tiered” money market account: These often require a minimum opening deposit in excess of $ 100 and pay a higher yield than most basic accounts. For example, you might earn 2.5% interest with a $500 account balance, but as much as 5% interest or more with a balance of $50,000.
• The package deal: This is a money market account coupled with a savings account, certificates of deposit, and other bank investments. Because the package deal utilizes several products, banks and credit unions may offer a slightly higher yield than they do for basic or tiered accounts. What’s more, the minimum deposit may be waived.