Savings Account vs. Money Market Account (MMA)

Savings Account vs. Money Market Account (MMA) – What’s the Difference?

Savings Accounts and Money Market Accounts are both types of deposit accounts at banks and credit unions.

They each have unique characteristics, but they also share some similarities.

Here’s a breakdown:

Savings Account

Typical savings account features:

  • Savings accounts are a type of account where you can deposit money, earn interest on that money, and withdraw it when you need it.
  • The main goal is to provide a safe place to save money over the long term.
  • They usually have fewer withdrawal and transaction abilities (under US law, you’re allowed to make six “convenient” withdrawals or transfers per month from savings accounts).
  • Typically, they don’t come with checks or debit cards, limiting your access to funds.
  • The interest rate on savings accounts is often relatively low.
  • FDIC or NCUA insured up to $250,000.

Money Market Account

Typical money market account features:

  • Money Market Accounts (MMAs) are a type of account that’s a hybrid between a savings and a checking account.
  • They tend to offer higher interest rates than traditional savings accounts. This is because banks and credit unions use the money deposited into MMAs for investments in stable, short-term, high-quality securities (like Treasury notes).
  • MMAs often require a higher minimum balance to open or maintain the account compared to a regular savings account.
  • They typically provide more accessibility to your funds. Many MMAs offer check-writing privileges and debit cards, although certain transaction limits still apply (like savings accounts, MMAs in the U.S. are often subject to the six-transactions-per-month limit).
  • FDIC or NCUA insured up to $250,000.

FAQs – Savings Account vs. Money Market Account (MMA)

What is a savings account?

A savings account is a type of bank account where you can deposit money, earn interest over time, and withdraw funds when needed.

It provides a safe place for storing money and earning a modest amount of interest.

The access to funds in savings accounts is typically limited, often with regulations restricting the number of transactions per month.

What is a Money Market Account (MMA)?

A Money Market Account is a type of deposit account that often offers higher interest rates than a standard savings account.

It’s a hybrid between a checking and savings account.

While they require a higher minimum balance, they typically provide more accessibility to your funds, often including check-writing privileges and debit cards.

What are the primary differences between a savings account and an MMA?

The primary differences are interest rates, access to funds, and minimum balance requirements.

MMAs generally offer higher interest rates and come with checks and/or a debit card for easier access to your funds.

However, they often require a higher minimum balance.

Savings accounts typically have lower minimum balance requirements and fewer access options, and they generally offer lower interest rates.

Are there withdrawal limits on these accounts?

Yes, both types of accounts generally have withdrawal limits due to federal regulations.

Regulation D allows up to six “convenient” withdrawals or transfers per month from both types of accounts.

This includes checks, debit card payments, transfers, and online payments.

Note that financial institutions may impose additional restrictions.

Are savings accounts and MMAs insured?

Yes, both savings accounts and MMAs are insured by the Federal Deposit Insurance Corporation (FDIC) in banks or by the National Credit Union Administration (NCUA) in credit unions, up to $250,000 per depositor.

Which type of account usually requires a higher minimum balance?

MMAs typically require a higher minimum balance than savings accounts. If you don’t maintain this minimum balance, you might have to pay a fee.

The exact amounts vary by institution, so be sure to check with your bank or credit union.

Which type of account is better for me?

The answer depends on your financial needs and goals. If you want easy access to your money and a higher interest rate, and you can maintain a higher balance, an MMA might be a good choice.

If you’re focused on saving money, prefer a lower minimum balance, and don’t need frequent access to your funds, a savings account could be a better fit.

Do MMAs come with check-writing privileges?

Yes, one of the distinguishing features of MMAs is that they often come with check-writing privileges and a debit card.

However, like savings accounts, they are still subject to transaction limitations.

Do the interest rates on these accounts stay the same or change?

The interest rates on both savings accounts and MMAs can change over time based on economic conditions and the policies of the bank or credit union.

It’s important to review the current rates before opening an account and monitor them regularly.

Can I have both a savings account and an MMA at the same time?

Yes, there are no restrictions preventing you from having both types of accounts.

Some people choose to use a savings account for longer-term savings goals and an MMA for emergency funds due to the typically higher interest rates and easier access to funds.


The primary differences lie in the interest rates, ease of access to your money, and the minimum balance requirements.

If you prioritize higher interest rates and don’t mind keeping a higher balance, a money market account might be a good fit.

If you want to avoid maintaining a high balance or don’t require frequent access to your savings, a traditional savings account could serve you well.

Always be sure to check the current terms and conditions with your financial institution as these can change over time.


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