A money market account is sort of like a savings account on crack.
It usually earns higher interest, but may have more restrictions. For example, you may need to keep a higher minimum balance than a regular savings account. Money market accounts are regulated like savings accounts, so you can only make six withdrawals a month. But, your money is also insured by the FDIC, a good thing in these volatile markets.
The money you put in money market accounts is typically invested in relatively "safe" investments like government bonds or certificates of deposit.
In general, money market accounts are a great place to hold your money for a rainy day. You don't have the same earnings potential as investments in the stock or commodities (gold, oil,etc.) markets, but you don't have the volatility either.
To invest in money market accounts, check out online banks like ING Direct. Online banks often give better rates, because they don't have to offset the costs of ATMs and bank branches.
It usually earns higher interest, but may have more restrictions. For example, you may need to keep a higher minimum balance than a regular savings account. Money market accounts are regulated like savings accounts, so you can only make six withdrawals a month. But, your money is also insured by the FDIC, a good thing in these volatile markets.
The money you put in money market accounts is typically invested in relatively "safe" investments like government bonds or certificates of deposit.
In general, money market accounts are a great place to hold your money for a rainy day. You don't have the same earnings potential as investments in the stock or commodities (gold, oil,etc.) markets, but you don't have the volatility either.
To invest in money market accounts, check out online banks like ING Direct. Online banks often give better rates, because they don't have to offset the costs of ATMs and bank branches.
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