The key to good banking is finding a way to keep your money safe from market losses while simultaneously letting it gain interest over time. While there are a variety of personal banking options that can do this, one many people don’t know about is a money market account. Before calling up your bank, it’s important to understand if it’s the right option for you.

Why a Money Market Account Is a Smart Banking Option

A money market account is a hybrid between savings and checking accounts. They typically offer higher interest rates than a normal savings account, so you can earn more money keeping it in a money market account. However, this personal banking solution also allows you more mobility in terms of using the money in it.

While it’s not as open as a checking account, which allows you to spend and move money whenever you want, most money market accounts let you write a check or use a linked card up to six times per month before receiving a penalty. Not only are you making more money, but you also have the freedom to spend it in an emergency.

How to Know if It’s the Right Banking Option for You

To understand whether you should move your money to a money market account, there are multiple factors to consider. First, most accounts require a larger sum of money to be deposited, typically starting at $2,500. If you’re not confident that you can maintain that amount, stick to a savings account to avoid penalties.

Another aspect to look at is the interest rates. While they are typically lower in savings accounts, if the difference is negligible, you won’t get much benefit from transitioning. Finally, a money market account is perfect if you want to have occasional access to spending the money in your savings but are confident it won’t happen excessively; otherwise, you will face penalties.

To learn if you can benefit from banking with a money market account, contact the experts at Magnolia Bank in Hodgenville, KY. For more than 100 years, this respected local bank has helped residents and businesses with all of their needs, and they have the necessary experience and knowledge to help you find the perfect banking solution to fit your unique financial situation. Schedule a consultation by calling (270) 358-3183 or learn more online.