Money market vs. checking accounts | finder.com

Money market vs. checking accounts

The right choice depends on how often you use it and whether you want to earn interest.

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Both money market and checking accounts can help you manage your money with the help of checks and debit cards. Checking accounts offer unlimited access and more account features. Money market accounts pay interest, which can be more beneficial with a higher balance.

What’s the difference between money market and checking accounts?

Money marketChecking
AboutInterest-bearing account offering flexible access to your money while you saveUnlimited access to your money, allowing you to deposit funds, write checks, pay bills, cover expenses and withdraw cash
InterestYesSometimes
Check writingTypicallyYes
ATM accessTypicallyYes
FDIC insuranceYesYes
Minimum depositVaries up to $25,000 Low
Six-transaction limitYesNo

What is the federal six-transaction limit?

Regulation D is a federal regulation that restricts all types of savings accounts to six “convenient” transactions per month. This includes checks, debit card payments, phone transfers and automatic transactions like bill pay.

Pros and cons of money market vs. checking account

Money market accounts

Pros
  • More interest. Money market accounts generally pay more interest than checking accounts.
  • Flexible access. Unlike traditional savings accounts, you’ll get a debit card and checks to access your money.
  • Fewer service charges. Since these accounts are still limited to six transactions per month, you’ll likely incur less service charges than you would with a checking account.
Cons
  • High minimum deposit. Money market accounts usually have higher initial deposit requirements than checking accounts.
  • Limited transactions. Unlike checking accounts, these accounts are limited to six transactions per month.
  • Monthly fees. Most money market accounts have monthly fees. And while they’re often avoidable, the conditions may be harder to meet than conditions on checking accounts.

Checking accounts

Pros
  • Unlimited transactions. There are no limits on how many transactions you can make per month.
  • Easily avoidable monthly fees. These accounts usually have low monthly fees and multiple ways to avoid them.
  • Low minimum deposit. Checking accounts generally have low or no initial deposit requirements.
Cons
  • Less interest. Most checking accounts don’t pay interest. The ones that do usually pay much less than money market accounts.
  • Other fees. Beyond monthly fees, checking accounts also often have ATM charges, overdraft fees, transfer fees and more.

Compare top-rated accounts

Name Product Interest rate (APY) Fee Minimum deposit to open
2.30%
$0
$100
A super-high interest rate if you're in the habit of saving at least $100 per month or have $25K in the bank.
2.00%
$15 per month
(can be waived)
$25
Earn one of the highest annual percentage yields (APYs) if you live in one of 42 eligible states, and access your money by ATM, check or bill pay.
2.25%
$10 per month
(can be waived)
$5,000
Enjoy the security and earning potential of a savings account while maintaining the flexibility to write checks.
2.02%
$25 per month
(can be waived)
$25,000
Earn 2.02% APY for 6 months on an MMA. Conditions apply.
2.00%
$0
$0
A high-interest, fee-free online bank account that helps you save.
1.85%
$0
$100
Reach your savings goals with a CIT Bank Money Market account. $100 minimum opening deposit.

Compare up to 4 providers

Name Product APY ATMs Fee
16,000 Chase ATMs and nearly 5,000 branches
$15/month
(can be waived)
If you’re new to Chase, get $200 when you open this account and complete qualifying activities. It boasts convenient features to help small and growing businesses reach their goals.
0.61% on balances of $100,000 to $10,000,000
0.51% on balances of $50,000 to $99,999.99
0.41% on balances of $25,000 to $49,999.99
Over 80,000 fee-free ATMs
$0
Account will boost your money’s productivity with a high yield, no monthly maintenance fee and the essential banking services your business needs.
0.80% on balances of $0 to $4,999,999.99
ATM fees reimbursed at any ATM nationwide
$10/month
(can be waived)
Earn up to 0.80% APY and pay no monthly maintenance fee with an average daily balance of at least $5,000.
ATM fees reimbursed at any ATM nationwide
$0
No monthly maintenance fees, a low minimum deposit requirement and unlimited domestic ATM fee reimbursements.
Huntington Unlimited Business Checking
Huntington Unlimited Business Checking
Free at more than 1,800 ATMs across the Midwest
$20/month
(can be waived)
Earn a $400 bonus when you open an Unlimited Business Checking account if you live in Ohio, Illinois, Indiana, Kentucky, Michigan, Pennsylvania or West Virginia. Conditions apply.
Huntington Unlimited Plus Business Checking
Huntington Unlimited Plus Business Checking
Free at more than 1,800 ATMs across the Midwest
$40/month
(can be waived)
Earn a $500 bonus when you open an Unlimited Plus Business Checking account if you live in Ohio, Illinois, Indiana, Kentucky, Michigan, Pennsylvania or West Virginia. Conditions apply.

Compare up to 4 providers

How to compare money market accounts and traditional checking accounts

Each account type was designed for a purpose, and knowing how to compare them can help you determine which is right for you:

  • Interest rates. While some checking accounts pay interest, you’ll almost certainly earn more interest with a money market account.
  • Deposit requirements. Money market accounts generally have higher initial deposit requirements.
  • Features. Money market accounts generally offer basic account features, but you’ll likely get more perks and benefits with a checking account.
  • Fees. There’s a good chance that both accounts will have fees. Compare options to find the best rates.
  • Access. Money market accounts provide some access to your money, but are still subject to the federal six-transaction limit. If you want unrestricted access, a checking account may be a better fit.
  • Security. Both of these accounts are eligible for FDIC deposit insurance, but only if the issuing bank is FDIC-insured.

Bottom line

Money market and checking accounts are both designed to help you manage your money, but the best option for you will depend on your situation. Money market accounts are generally better for saving, whereas checking accounts can provide unrestricted access to your money.

Once you decide which type is right for you, compare your options to find the best account.

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