Benefits of High-Yield Money Market Accounts
A money market account (MMA), also known as a money market deposit account (MMDA), is a type of interest-earning savings account offered by some banks and credit unions. Money market accounts provide many of the conveniences of a typical savings account but with a major added benefit — they often offer higher rates than traditional savings or checking accounts. Some financial institutions set limits on how frequently you can withdraw funds from their money market accounts or high minimum deposit requirements. However, competitive money market accounts opened through Raisin do not currently have any such withdrawal limits and only a $1 minimum deposit . So, a money market account allows you to earn more interest on your savings while still having easy access to your funds when needed.
Tips for Using Money Market Accounts
Why settle for average rates when it comes to your savings? A traditional savings account may offer more interest than, say, a checking account. But savers can do much better at extracting value from their cash reserves by opting for a higher-yielding savings product like a money market account.
What can you do with a money market account? Consider money market accounts for holding your emergency fund, savings for a major expense like college tuition, or extra cash you don't need access to on a daily basis. Holding those reserves in a money market account lets you put them to work. Click the button below to read more about how you can use a money market account to up your savings game.
High-Yield Money Market Accounts vs. Traditional Savings Accounts
How to Open a High-Yield Money Market Account
Shop around for competitive money market accounts from different banks and credit unions. Choose one that works best for your needs. Consider accessibility, money market account rates, minimum balance conditions, maintenance fees and other charges, and withdrawal limits, if any.
Get your documents in order
Banks and credit unions will require basic information about you to confirm your identity and eligibility. Accounts opened through Raisin are through an entirely online process that verifies your identity digitally.
Make an opening deposit
This is your first step toward earning interest. Rules are different with each institution. Some banks require a deposit to open an MMA, while others let you open the account first and fund it later. With Raisin, all accounts have just a $1 minimum deposit to open. Just remember, the higher your deposit, the higher your earning potential.
High-Yield Money Market Accounts
Are you searching for a secure and intelligent way to grow your savings while maintaining easy access to your funds? High-yield money market accounts might be the solution you need.
These financial instruments offer competitive interest rates, often making them the preferred choice for savvy savers seeking better returns than traditional savings accounts.
In this comprehensive guide, we’ll demystify high-yield money market accounts for you, outlining their benefits, potential drawbacks, and potential alternatives.
High-yield money market accounts: A savings account offering higher interest and liquidity with features like no transaction limits, federal deposit insurance, and interest compounding.
No transaction limits: Since April 2020, federal regulations have lifted the limit on the number of monthly transactions for money market accounts. While some institutions may charge for transactions above the limits, Raisin does not.
Important factors for account selection: Consider interest rates, fees, minimum balance requirements, accessibility, FDIC or NCUA insurance, and the reputation of the financial institution when selecting a money market account.
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What is a high-yield money market account?
A high-yield money market account is a type of savings account offering significantly higher interest rates compared to standard savings accounts. These accounts combine the features of a savings account and a checking account. They provide a higher interest rate while maintaining liquidity and allowing you to access your funds when needed.
High-yield money market accounts are typically available through banks and credit unions, making them a secure and federally insured way to save money. High-yield money market rates can be variable or fixed, and they may require a higher minimum deposit to open an account. Money market accounts opened through Raisin have variable interest rates and a $1 minimum deposit to open.
Although high-yield money market accounts share common features with regular savings accounts, they also boast distinct characteristics.
Understanding these nuances can empower you to make informed decisions to optimize your savings. Here's what you should know:
No transaction limits: As of April 24, 2020, federal regulations no longer restrict money market accounts to six monthly transfers or withdrawals. While some institutions may charge for transactions above the limit, Raisin does not.
Safety and stability: Money market accounts are recognized as safe, low-risk investments as long as the institutions offering them are insured by the FDIC or NCUA (like all of Raisin’s partner banks and credit unions).
Interest compounding: Most high-yield money market accounts compound interest. This means that you earn interest on your initial deposit and on the interest already earned.
What to look for in a high-yield money market account
Choosing the right high-yield money market account is essential to maximizing your savings and realizing your financial goals. Here are critical factors to weigh before deciding:
Interest rates: Look for accounts with the highest interest rates to maximize your returns. Compare rates across different financial institutions to find the best deal. With Raisin, you can open accounts with institutions across our entire network of banks and credit unions all with one login, making it easier to find the best product for you.
Fees and charges: Be mindful of monthly maintenance fees or transaction charges that may impact your earnings. Some accounts may waive fees if you maintain a certain minimum balance. Accounts opened through Raisin have no fees ever.
Minimum balance requirements: Check the minimum balance required to open and maintain the account. Ensure it aligns with your financial situation and goals. For accounts opened through Raisin, this minimum deposit is just $1, making it easy to get started.
Accessibility: Check the ease of accessing your funds via online banking and verify any withdrawal restrictions that may exist. With Raisin, funds can be accessed 24/7 online and there are currently no withdrawal limits in place.
FDIC or NCUA insurance: Ensure that the money market account is insured by the FDIC (for banks) or the NCUA (for credit unions) to protect your savings in case of bank failure.
Customer service and reputation: Choose a financial institution with a strong reputation — and even decide based on core attributes of that institution, such as whether it gives back to charity, has a focus on its local communities, or supports initiatives like education financing or community development.
What are the benefits and drawbacks of a money market account?
A high-yield money market account presents various advantages, along with a few considerations to keep in mind. Let's take a look at the pros and cons of this type of account.
Benefits of a money market account
A high-yield money market account provides several attractive benefits, making it an appealing option for savers looking to earn more on their cash while still retaining access. These include:
Higher interest rates: High-yield money market accounts offer more competitive interest rates compared to traditional savings accounts, helping your savings grow faster.
Liquidity: You can access your funds easily and frequently through various channels, helping you gain financial flexibility.
Security: Money market accounts are a safe option, backed by FDIC or NCUA insurance, which protects your funds up to the insured limit.
Low risk: Money market accounts are low-risk, making them ideal for conservative investors prioritizing capital preservation over higher returns.
Drawbacks of a money market account
Despite the many benefits of high-yield money market accounts, they may not be right for everyone. Here are some considerations to keep in mind:
Minimum balance requirements: Some money market accounts have high minimum balance requirements, which might limit access for those with lower savings. No money market accounts opened through Raisin are subject to minimum balance requirements.
Fluctuating interest rates: High-yield money market rates are generally higher than regular savings accounts but can still fluctuate, potentially impacting your returns.
Opportunity cost: The returns from a money market account may not match inflation rates, possibly leading to missed growth opportunities in the long term.
What are the alternatives to money market accounts?
If high-yield money market accounts don't align with your financial goals or risk tolerance, you can choose from other alternatives. These include:
High-yield savings accounts: Similar to money market accounts, these accounts offer competitive interest rates while providing easy access to your funds. They often have lower minimum balance requirements.
Certificates of deposit (CDs): CDs offer fixed interest rates for a specific term, making them a suitable option for those with longer saving goals and lower liquidity needs.
Investment accounts: For longer-term financial goals, consider investing in stocks, bonds, or mutual funds. These come with higher risks but can potentially offer higher returns.
Discover high-yield money market accounts with Raisin
Finding the right avenue to grow your savings is an integral part of managing your financial health. High-yield money market accounts offer a unique blend of attractive interest rates, safety, and flexibility, making them a compelling choice.
With Raisin's user-friendly platform, you gain access to an exclusive selection of deposit products, including high-yield money market accounts. It's designed to help you navigate your financial journey, allowing you to build a personalized savings strategy that suits your specific needs.
You can also monitor and control your financial well-being effortlessly with just one monthly statement showing all your balances and earned interest.
Don't miss out on better returns. Register today to unlock the power of high-yield money market accounts.
Frequently asked questions about high-yield money market accounts
How do high-yield money market accounts differ from regular savings accounts?
A high-yield money market account is a type of savings account that offers significantly higher interest rates compared to traditional savings accounts. While both accounts provide a safe place to store your money, a high-yield money market account typically offers better returns due to its higher interest rates and potential for interest compounding. Unlike a regular savings account, money market accounts often come with limited check-writing abilities and a higher minimum deposit requirement.
Are high-yield money market accounts safe and insured?
Yes, high-yield money market accounts are generally considered safe and secure, as long as the bank or credit union offering them is insured by the FDIC or NCUA, respectively. This means that if the financial institution fails, your deposits in the money market account are protected up to the maximum insured limit, which is currently $250,000 per depositor, per institution. All of Raisin’s partner banks and credit unions are federally insured.
Can I access my funds easily with a high-yield money market account?
Yes, one of the advantages of a high-yield money market account is its liquidity. With Raisin, there are no transaction limits and transfers to your external linked account typically take 1-3 business days.
What factors should I consider when choosing a high-yield money market account?
As mentioned, when selecting a high yield money market account, consider the following factors:
Fees and Charges
Minimum Balance Requirements
FDIC or NCUA Insurance
Customer Service and Reputation
What Is Raisin?
Raisin brings together high-yielding savings products offered by a network of U.S. financial institutions. It’s your destination to discover competitive savings products and start saving wisely. Select and fund multiple savings products from different institutions and manage them all from one account.
Funds deposited into any of the savings products available through Raisin are always held by a federally insured financial institution. A very easy and safe way to diversify your deposit portfolio. We use a host of cybersecurity measures to protect your funds and sensitive information.
Savings products from our network of financial institutions offer flexible terms and some of the most competitive interest rates. You can easily find the right product or mix of products for you.
One account to hold all your deposit products. Simplified statements. Easy access to manage your funds – all through a streamlined digital platform.
How Raisin Protects Your Money and Personal Information
Federal Deposit Insurance Corporation
National Credit Union Administration
Cybersecurity is a top priority at Raisin
Open an Account in 3-5 Minutes
the right product for your savings goals.
with an email address and password, then verify your identity and bank information.
the savings products you add to your new Raisin account.
How Raisin Compares
Raisin is a digital platform that gives savers unparalleled access to a variety of deposit products through the convenience of a single account, helping you unlock the growth potential of your cash savings.
Raisin customers use the platform to fund federally insured deposit products offered by numerous U.S. banks and credit unions with a wide range of maturities and APYs (annual percentage yield), allowing you to build a savings strategy to suit your earning and liquidity needs.
Raisin is not a bank. It provides the digital “storefront” where banks and credit unions can promote their deposit products.
Raisin is operated by Raisin LLC, a 100% subsidiary of Raisin GmbH, a trailblazer for open banking in the deposits and investments space. In the U.S., Raisin helps banks and credit unions improve their deposit funding by offering national reach for their retail deposit products, and provides savers with better access, more choice and higher convenience when evaluating savings products from FDIC insured banks and NCUA insured credit unions.
Your Raisin account gives you access to savings accounts and certificates of deposit offered by a variety of banks and credit unions with the security of federal deposit insurance. These products include:
High-yield Savings Account (HYSA). As its name indicates, this account type functions like a traditional savings account — with typically no restrictions on depositing and withdrawing funds — but earns interest (or dividends in the case of credit union savings products) at rates that are higher than the national average for standard savings accounts.
Money Market Deposit Account (MMDA). Also known as a money market account or MMA, this type of savings account offers a varying rate that allows you to earn interest (or dividends) on your funds with maximum flexibility for withdrawals. Like a HYSA, an MMDA offers features of a traditional savings account with typically higher returns.
No Penalty CD. Through the flexibility of a No Penalty CD, you can lock in a competitive rate for a fixed term with the option to make a full withdrawal without having to pay a penalty for the early termination. Terms and conditions may vary by product. Please see specific product terms for more details.
Fixed Term CD. With this longstanding savings vehicle, funds are held for a fixed term, and a competitive APY (annual percentage yield) provides safe, predictable earnings. In contrast to No Penalty CDs, typically you are charged a fee if you do not complete the full term of the Fixed Term CD.
Interest (or dividend in the case of credit union savings products) is compounded daily and posted to your account monthly.
The short answer is yes! Raisin exclusively partners with FDIC-insured banks and NCUA-insured credit unions.
For Raisin customers who hold savings products offered by one of our partner banks, funds are insured by the FDIC up to the maximum amount in accordance with and as permitted by law at each bank holding their funds. The standard deposit insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per account ownership category. Ownership categories as defined by the FDIC include single bank accounts (owned by one person/depositor) and joint bank accounts (owned by two or more persons/depositors). Revocable trust accounts and some types of retirement accounts (e.g., IRAs) are among the other ownership categories covered by FDIC insurance. All deposits you have at a bank — whether made through Raisin or otherwise — count toward the deposit insurance limit. If funds held at a bank in a certain ownership category exceed the coverage limit, then the amount in excess of the limit will not be insured.
For Raisin customers who hold a savings product offered by one of our partner credit unions, funds are insured by the NCUA through its Share Insurance Fund. According to the NCUA, each credit union member has at least $250,000 in total coverage. The Share Insurance Fund insures individual accounts up to $250,000. Additionally, a member’s interest in all joint accounts combined is insured up to $250,000.
At Raisin, cybersecurity is our priority. Raisin is a SOC 2 certified platform, meaning it has been validated by outside auditors across five (5) key information security principles. We also use a variety of measures to protect our customers' data, privacy and transactions, including:
• User authentication. The Raisin platform uses multi-factor authentication combined with leading authentication technology to validate our customers’ identities.
• Data encryption. Your personal information is encrypted in-transit and at rest using advanced cryptographic security algorithms.
• Site protection. Web application firewall advanced internet protection technologies are implemented to protect Raisin.com from malicious actors, botnets and denial of service attacks (DDOS).
• Monitoring. An always-on information security monitoring platform detects and alerts us to information security events.
• Assessments. Our platform undergoes vigorous security assessments and testing throughout the lifecycle of application development, from architecture planning to production phases.
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A. Check out our savings marketplace and choose a product in which you would like to deposit money.
B. Create your username and password.
C. Complete an application and, after successful identity verification, link a bank account from which to fund your first savings product.
D. Start earning interest as soon as your money is received by the bank or credit union offering the savings product you selected.
Any questions or concerns? Email us at firstname.lastname@example.org.
All deposits and withdrawals are completed within one to three (1-3) business days. After the initial deposit a withdrawals limitation for the first few business days may exist.
Business days are Monday through Friday excluding U.S. bank holidays.
For products offered by banks, all necessary registration is handled when you become a Raisin customer. One of the many benefits of our platform is that you can open a single account and earn competitive interest rates from banks in the Raisin network. When you select and fund a savings product offered by a credit union, there is an additional step of becoming a member. Raisin makes that process quick, easy and free. You still have one Raisin login and can view all your savings products in one convenient dashboard.
The current APY for your savings products can always be viewed on the Account Overview page when you are logged in to Raisin. This information also appears on monthly statements.
You cannot currently link your Raisin account to a third-party app, but we may offer this feature in the future. For now, you will not be able to link your selected savings product to a third-party app even if the bank or credit union offering that product does so outside of the Raisin platform.