| All banks offer savings accounts that pay interest
on the money you deposit. There are no minimum balances, but you
can't write checks from a savings account. You can take money from
your savings account anytime you want though, through either an ATM card
or at the bank counter. Interest is calculated in one of three ways:
on the money in your account from the day it's deposited until the day
it's withdrawn; on the average daily balance in your account for the month;
or on the lowest daily balance. Of the three, the lowest daily balance
pays the least interest. |
A money market deposit account is a type of savings
account. It is better than a regular savings account in that you
can usually write a limited number of checks from the account. Also,
it usually has a higher interest rate. The downside is that they
usually require a minimum initial investment, typically from $1,000 to
$2,500. You also have to maintain a minimum balance, as much as $1,000.
Check to see if the money market account you're interested in is FDIC insured,
since many are not. |