Money market account.
In plain English
A money market account (MMA) is a savings account offered by banks and credit unions, FDIC-insured up to $250,000 per depositor per bank. MMAs typically pay slightly higher rates than a basic savings account and may include limited check-writing privileges or a debit card. The 'money market' name reflects that the bank invests deposits in short-term, very safe debt; from the customer side, it acts like a savings account.
01Why it matters
For most savers, an MMA at a competitive bank does the same job as a high-yield savings account and is fully FDIC-insured. The branded HYSA category from online banks (Marcus, Ally, Discover) is often where the better rates sit, but a competitive MMA at a local credit union can match them.
02The math, step by step
An MMA at an online bank might pay 4.5% APY in 2024-2025 with a $1,000 minimum and limited check writing. The same bank's basic savings account might pay 0.5%. Same FDIC insurance, same bank, very different yields, because the bank steers higher balances into MMA branding.
Illustrative example. The amounts here are hypothetical, chosen to show how the math works, not real quoted rates or figures.
03What this is NOT
A money market account is a bank product, FDIC-insured. A money market fund is an investment fund (held at a brokerage), not FDIC-insured. Both are very safe; only the MMA carries explicit federal deposit insurance.
04Receipts
Every figure on this page is sourced to a primary document. Tap to open the original.
Plain-English answers from our glossary. Receipts included. Never advice.
Educational tool. Answers come only from ClearMoneySchool's published glossary and are not advice. Why we never give advice