Money market accounts (MMAs) can be a good place to keep your cash if you’re looking for a relatively high interest rate along with flexibility.
Unlike traditional savings accounts, MMAs typically offer better returns and may also provide check-writing privileges and access. This makes these accounts ideal for holding long-term savings that you want to grow over time, but that you can still access when needed for certain purchases or bills.
Where are the best money market rates today?
The national average interest rate for money market accounts is just 0.64%, according to the FDIC. However, the best money market account rates often pay around 4.5% to 5% APY or even more – similar to the rates offered at . For example:
Interested in earning the best possible interest on your savings? Here’s a look at some of the best savings and money market account rates available today from our verified partners.
Historical money market account rates
Money market interest rates have fluctuated significantly in recent years, largely due to changes in the Federal Reserve’s target interest rate.
In the wake of the 2008 financial crisis, for example, interest rates were kept extremely low to stimulate the economy. The Fed lowered the federal funds rate to near zero, leading to very low MMA rates. During this time, money market account rates were typically around 0.10% to 0.50%, with many accounts offering rates at the lower end of this range.
Eventually, the Fed began raising interest rates gradually as the economy improved. This led to higher returns on savings products, including MMAs. But in 2020, the COVID-19 pandemic led to a brief but sharp recession, and the Fed once again cut its benchmark interest rate to near zero to combat the economic fallout. This resulted in a sharp drop in MMA rates.
But starting in 2022, the Fed began a series of aggressive rate hikes to combat inflation. This led to historically high deposit rates across the board. By the end of 2023, money market account rates had risen significantly, with many accounts offering 4.00% or higher.
As of 2024, MMA rates remain high by historical standards, although they have begun a downward trajectory following the Fed’s latest rate cut in September. Today, online banks and credit unions tend to offer the highest rates.
What to consider when choosing a money market account
When comparing money market accounts, it’s important to look beyond just the interest rate. Other factors, such as minimum balance requirements, fees and withdrawal limits, can affect the total value you get from the account.
For example, it’s common for money market accounts to require a large minimum balance to earn the highest advertised rate — as much as $5,000 or more in some cases. Other accounts may charge monthly maintenance fees that can eat into your interest income.
However, there are several MMAs available that offer competitive rates with no balance requirements, fees or other restrictions. That’s why it’s important to shop around and compare accounts before making a decision.
Also, make sure the account you choose is insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA), which guarantees deposits of up to $250,000 per month. institution, per deposits. Most money market accounts are federally insured, but it’s important to double check in the rare event that the financial institution fails.
Read more: Money Market Account vs. High-Yield Savings Account: Which Is Best for You?