Money market bank accounts come with certain benefits that can make them a good choice for your short-term savings. Savings accounts, interest-bearing checking accounts and CDs are among the other options you may be considering. As long as they're offered by an FDIC-member bank, they're all safe places to put your money, and as part of an overall financial plan, all these accounts can work as a secure financial base.
Money Market Accounts
One benefit of money market bank accounts is that they usually pay a rate of return equal to (or better than) many traditional savings accounts, while allowing greater access to your money. With money market bank accounts, you often can write checks, use a debit card and make ATM withdrawals. Keep in mind that federal law limits checks and certain types of telephone and electronic withdrawals and transfers from money market accounts to 6 per statement cycle. Some transactions are unlimited. You can make as many deposits as you wish. If you need access to the money in your money market account, you can make unlimited ATM withdrawals or call us any time and request a check made payable to you.
CDs often offer a higher rate of return than money market bank accounts, but CDs require you to tie up your money for anywhere from a week to several years, or pay a penalty for early withdrawal. One exception to this rule is the Ally Bank No Penalty CD. With it, you can withdraw all your money, including interest earned, without penalty, any time after the first six days following the date you fund your CD.
Interest-bearing Checking Accounts
Interest-bearing checking accounts allow unlimited check writing, electronic transfers and debit card transactions, but the interest they pay is usually less than what you find on money market accounts, and some may require a substantial monthly minimum balance to avoid paying a maintenance fee. Ally Bank Interest Checking doesn't require a minimum balance and pays one of the most competitive interest rates available in the country.
Ally Bank, member FDIC