What’s Best for You: Money Market Account vs. Savings Account?
Either Way, Earn a Great Rate With No Monthly Maintenance Fees.
When people have some cash on hand, they may consider either a money market savings account or a more traditional savings account. These two types of accounts are quite similar, but understanding some slight differences can help you decide which is right for you.
Both types of accounts pay interest on deposits, and your funds in both are insured by the Federal Deposit Insurance Corporation (FDIC ) to the maximum amount allowed by law. In addition, both allow you to make as many deposits as you want. However, for both accounts there is a limit of six withdrawals or transfers per statement cycle a limit set by federal law.
The primary difference between a money market account and a savings account is how you can access your funds. Today, it’s not uncommon to find money market accounts that allow you to write checks, make electronic transfers and use ATM and debit cards. With a savings account, on the other hand, you may need to take money out via electronic transfer or by calling the bank. Also, there may be differences in interest rates on each type of account. Sometimes savings accounts offer a slightly higher rate than money market accounts a tradeoff for the greater flexibility of access you get with money market accounts.
Which account is best for which goals?
With all of that in mind, then, a savings account might be appropriate when you want to put cash away for larger emergencies or future major purchases when you don’t need to access your money regularly. A money market account might make sense when you want to write checks on an account, but not too many. “I had a client who put their money in an online money market account to save when they were buying a house,” said Erin Baehr, president of Baehr Financial in Stroudsburg, Pennsylvania. She added, “They were able to just write the check with their offer when they wanted to, right from their account without having to worry about transferring money.”
Consider Ally Bank.
With an Ally Bank Money Market Account. your money earns a variable rate that’s consistently among the most competitive in the country according to Bankrate.com. and you can open and fund your account with any amount. You get free standard checks and a debit card for convenient access to your money. You can also use any Allpoint no-fee ATM plus receive up to $10 reimbursement for fees charged at other ATMs nationwide each statement cycle. The Ally Bank Online Savings Account is a simple, safe and easy way to put money to work. The Ally Bank Online Savings Account pays a competitive rate of interest without the monthly maintenance fees and minimum opening deposit requirements you’ll find at other banks. Learn more at Allybank.com or call live, 24/7 customer care at 877-247-ALLY (2559).
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Learn About the Risks of Options Trading
Options involve risk and are not suitable for all investors. Options investors may lose the entire amount of their investment in a relatively short period of time.
Prior to buying or selling options, investors must read a copy of the Characteristics and Risks of Standardized Options brochure (PDF), also known as the options disclosure document. It explains the characteristics and risks of exchange traded options.
You can also request a printed version by calling us at 1-855-880-2559 .
A few things you should know
Ally Financial Inc. (NYSE: ALLY) is a leading digital financial services company and a top 25 U.S. financial holding company offering financial products for consumers, businesses, automotive dealers and corporate clients. Ally Bank, the company’s direct banking subsidiary, offers an array of banking products and services.
Deposit products (“Bank Accounts” on Ally.com) are offered by Ally Bank, Member FDIC. In addition, mortgage products are offered by Ally Bank, Equal Housing Lender . NMLS ID 181005. Credit and collateral are subject to approval and additional terms and conditions apply. Programs, rates and terms and conditions are subject to change at any time without notice.
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Options involve risk and are not suitable for all investors. Review the Characteristics and Risks of Standardized Options brochure before you begin trading options. Options investors may lose the entire amount of their investment in a relatively short period of time.
Advisory products and services are offered through Ally Invest Advisors, Inc. an SEC registered investment advisor. Brokerage accounts are serviced by Ally Invest Securities LLC and advisory client account assets are kept in custody with Apex Clearing Corporation, members FINRA and SIPC. View all Advisory disclosures
Foreign exchange (Forex) products and services are offered to self-directed investors through Ally Invest Forex LLC. Ally Invest Forex LLC, NFA Member (ID #0408077), acts as an introducing broker to GAIN Capital Group, LLC (“GAIN Capital”), a registered FCM/RFED and NFA Member (ID #0339826). Your forex account is held and maintained at GAIN.
Ally Invest Forex LLC and Ally Financial Inc. are separate, but affiliated companies. View all Forex disclosures
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Forex, futures, options and other leveraged products involve significant risk of loss and may not be suitable for all investors. Products that are traded on margin carry a risk that you may lose more than your initial deposit. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act.
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Products offered by Ally Invest, but not limited to, Ally Invest Advisors, Ally Invest Securities, Ally Invest Forex, and Ally Invest Futures are NOT FDIC INSURED, NOT BANK GUARANTEED, and MAY LOSE VALUE.
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