Best Money Market Accounts: The Things You Need To Know

2007-03-08 10:33:40

( Financial )



Money market accounts have been around for a long time and are extremely popular with a lot of investors. Money market account is basically a type of mutual fund that invests your money in government debt securities such as treasury bills for a short amount of time. The standard length of time your can park your money in a money market account is a year.

The best money market accounts are highly liquid. This means you can withdraw your money at any time with little or no notice. This is very convenient compared to Certificates of Deposits where you need advance notice to take out your money. Writing checks can do withdrawals from your money market account. There are also no penalty fees attached to withdrawal from your account.

The best money market accounts are also relatively low risk compared to other investments. This type of mutual fund poses little risk because you are investing against government securities. There is a little chance that you are going to lose your investment because the government has the authority to raise taxes to pay for its obligations. There is also little risk because most money market organizations have insurance that covers your investments.

Money market accounts are also a better choice than parking your money in a savings or checking account. Returns from your money market accounts will be higher compared to a normal savings account or a certificate of deposit.

So if you are looking for the best money market accounts, you should visit your bank and check if they offer this service. Money market account is a great way to hold your money in a short amount of time. Your investments will earn much more than just letting your money sit in a normal savings account that earns a little interest.


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