Money market accounts is an interest-bearing account that typically pays a higher interest rate than a savings account, and which provides the account holder with limited check-writing ability. The account thus offers the holder benefits typical of both savings and checking accounts. This type is likely to require a higher balance than others and is Insurance Corporation insured. They are able to offer a higher interest rate by requiring a higher minimum balance, and by placing restrictions on the number of withdrawals the account holder may take over a given period of time. This restriction makes them less liquid but more liquid than bonds. it pursue investing deposits in vehicles such as certificates of deposit, government securities, and commercial paper that offer higher yields than are found in savings accounts.

When opening an account with any bank, individuals will often check for whether the account has checking privileges and what interest benefits it offers. Most accounts that banks offer, give you either one of these benefits but not both. A checking account will allow you to write checks, but no interests. A savings account on the other hand will only offer you interest on your savings. Money market accounts are then a good choice for an individual that wants both priviledges. It will offer you a higher interest rates compared to savings and allow you limited checking abilities. The downside (which could also be an upside) is that they often require a higher initial deposit that its counterparts. Other than that, it is a recommended account that any investor should have.