Money Market vs. CD

Putting your savings into a money market account or a certificate of deposit (CD) provides a safe way of earning interest and growing your balance over time. Your funds in both have the benefit of Federal Deposit Insurance Corporation (FDIC) insurance at an FDIC-member bank like Ally Bank.

So which is a better way to go, money market or CD?

The answer depends on your needs, so it’s important to know the differences as you consider money market vs. CD accounts. A money market account typically earns a variable interest rate. A CD typically comes with an interest rate that often does not vary over the term of the CD. So if earning a great annual percentage yield (APY) is your only concern, a CD might make the most sense.

With a CD, however, you almost always agree to keep your money deposited until maturity or pay an early withdrawal penalty. So when it comes to convenient access to your funds, a money market account may be the better choice. With a money market account, you can access the money whenever you need it within federal limits on the number of transactions per month.

Ally Bank does offer another option. With the Ally Bank No Penalty CD, you get a CD that allows you to withdraw all your money, including interest earned, without any penalty, any time after the first six days following the date you fund your account.

The bottom line is that choosing which type of account to help you save doesn’t have to be an either/or choice. If you’re saving for a longer-term goal, CDs may be a good option. And for your emergency fund or other shorter-term goals, a money market account might work. If you’re not sure when you’ll need access, maybe our No Penalty CD is the way to go.

Whatever the case, Ally Bank is here to help. The Ally Bank Money Market Account and our variety of CDs give you some of the most competitive rates in the country, according to, and your funds are insured by the FDIC up to the maximum amount allowed by law.

Learn more at or call live, 24/7 customer care at 877-247-ALLY (2559) today.

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