Want a Single Account With the Features of Checking and Savings? Consider This One

Earning interest and writing checks: two great things that are even better together.

Being an adult has its ups and downs. One of the definite ups is having some money saved and getting to decide where you want to put it. You have so many options… you can use it to pay down your debt, invest, or even spend it on something nice for yourself. But hear me out: What if you opened a new bank account instead?

Checking and savings accounts get a lot of press, but did you know there's an account out there that has features of both? It's true. Money market accounts (MMAs) offer higher annual percentage yields (APYs) on your money, like a good high-yield savings account, but they also give you easier access to your money, like a checking account. Here's why it pays to consider putting your money into a money market account, and a few things to look for to ensure you've found a good one.

Why should you consider a money market account?

With so many bank accounts out there, you might be wondering what's so special about MMAs and why they're worth opening. Money market accounts come with some pretty cool perks.

Check-writing capability

The main feature that MMAs share with your trusty checking account is the ability to write checks on the money kept in one. This is very convenient should you want to pay directly with funds in the account. Some MMAs come with checks automatically, but not all do, so be sure to verify the account you're considering does if this is a feature you'll use. It's also important to note that MMAs are subject to Regulation D, meaning that account holders are limited to six or fewer "convenient" transactions per month. If you exceed that number, you could be subject to fees or even have your MMA turned into a checking account, so tread lightly.

Higher APYs

Access to a higher interest rate is the biggest feature that MMAs share with high-yield savings accounts. A lot of the best savings accounts are now paying higher interest, which is a silver lining of consumer interest rates being up across the board (thanks to the rate hikes implemented by the Federal Reserve in 2022). MMAs have long been known for offering higher annual percentage yields (APYs) on money kept in them, which makes them a great place to keep your emergency fund in particular. You want easy access to that money (in case of emergencies), but ideally, you also want it to grow while it sits.

FDIC insured

While the word "market" may make you think about the stock market, it's important to note that money market accounts have nothing to do with investment accounts, and as such, the money you keep in one (up to $250,000) is protected by the FDIC. The Federal Deposit Insurance Corporation insures consumer deposits in checking, savings, certificate of deposit (CD), and money market accounts in case of bank failure. How cool!

What to look for

Ready to put that extra money into a money market account? Here are some ways to tell you've found a winner.

Reasonable minimum balance requirements

Unlike for checking or most savings accounts, some banks have a minimum balance requirement to open or maintain a money market account. In some cases, you can open the account with a lower amount of money, but you might need to keep it funded to a certain level in order to earn the highest APY. Read the fine print and ensure you can meet this requirement on the account you're considering.

No monthly fees

Bank fees have long been a part of life, but they don't have to be. Many of the best banks have done away with monthly maintenance fees altogether (these are charged just for the privilege of keeping your money in the account). So if the bank you're considering charges a fee on MMAs, see if there are requirements you can meet to avoid it. For example, some banks waive these fees if you have money regularly directly deposited into the account.

A debit card

Not only do MMAs allow you to write checks, some even come with a debit card! Debit cards are incredibly convenient, and can be used as a payment method in addition to being used to withdraw cash from an ATM. If this kind of easy access to your money is important to you, look for an MMA that comes with a debit card.

If you've got some money in need of a new home, consider a money market account. You can keep your money safe and earn interest, while also getting easy access to it when you need it. Win win!