One of the biggest benefits of an MMA is that you usually have easier access to your money than other savings accounts. Money market accounts will often come with checks, a debit card, or an ATM card, meaning that you don’t need to transfer money to a checking account before making payments or purchases. This makes it easy to use your MMA when you’re in a bind or need quick access to more money than is in your checking account.
But an MMA doesn’t work exactly like a checking account. There are almost always limits on the amount of transactions that can take place within a specified time period (generally between 3 and 6 in a month). These transactions can include certain transfers, payments, and other ways that you access your money. When that limit is reached, you can face penalties or fees for additional transactions. If you’re considering an MMA, be sure to check with your bank or credit union for specific regulations.
To go along with a higher interest rate, an MMA will often require a bigger initial deposit when it’s opened. The minimum required balance, or amount of money that must remain in the account if you want to avoid fees, is also often higher. This can make it more difficult to open and maintain an MMA than a traditional savings account with a lower threshold.