The differences between a savings account and a money market account are largely arcane. What is the difference between a savings account and a money market account? Therefore, we strongly recommend that all depositors consider the rates at online banks as savings and money market accounts online can easy be set up to enable quick transfers to your favorite local bank. This leads to different rates.īestCashCow’s surveys show that online banks offer higher savings and CD rates because they have lower expenses from not having to maintain brick-and-mortar locations. Banks have different cost structures and they also have different needs for capital. Like any active marketplace, there are buyers and sellers of goods and services at different prices.

If you are still uncertain whether you are within FDIC limits, you should visit the FDIC's website to determine your coverage limits based on your circumstances.Īdvantages of Local Savings or Money Market Accounts:įREQUENTLY ASKED QUESTIONS ABOUT LOCAL SAVINGS RATES Why do savings rates vary so much?Įven though rates are at levels that are historically very low, there is competition for your money. Learn more about FDIC insurance and different product types here. You should not deposit over $250,000 at a single bank across all products (savings or share certificates, certificates of deposit or time deposits, etc.) unless these deposits are made across different ownership categories (individual, joint, etc). You will find a map with all banks that are close to you here.īestCashCow strongly recommends that when depositing money, you stay within the insured limits of the Federal Deposit Insurance Corporation (“FDIC”). Physical branches also provide an easy way to get cash instantly, to deposit checks, to access to notaries, and sometimes to get free coffee and donuts.

While online savings account have grown in popularity and usage dramatically over the past fifteen years, some consumers prefer opening an account in a branch and having a personal relationship with the people who safeguard their money. However, if you have cash that you do not believe you will need for at least a year, you may want to consider investing in a certificate of deposit. Individuals often use savings accounts for a home down payment, a vacation, a wedding, a car, an emergency fund, or other near-term expenditures. Savings accounts are a good place to keep money for unforeseen expenses, as well as money that you may be preparing to use and want to keep safe.

Savings accounts offer depositors flexibility along with the stability of FDIC insurance (assuming your deposit amounts are within FDIC limits – see below).

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