Modest interest earned with limited withdrawals per month, give the depositor access to their money when there is a need for immediate funds. By maintaining, a minimum balance, funds will remain available and will increase in value if the account remains untouched. Also, maintaining a minimum balance will avoid costly monthly service charges. There are no guarantees with stock or bond markets as had been demonstrated in the last few fiscal quarters, however, the FDIC (Federal Deposit Insurance Corporation) guarantees deposit accounts that meet certain criteria.

Moneymarketaccount.net is a great source of information when it comes to this type of deposit account. Information contained within their pages, will assist prospective depositors in making the right choices when it comes to money market accounts. With APY (annual percentage yield) rates, changing rapidly in the banking industry it is imperative that good money managers choose investment accounts that will best suit their needs. A depositor might want, low minimum balances, maybe a higher yield, or lower bank service charges.

A few of the reasons that a money market account is a good choice for an investor/depositor: safety, liquidity, FDIC insurance (if meeting criteria), no long term investment, and ability to access funds immediately. Even though they are similar to checking or savings accounts, the returns of a money market account far out perform those types of accounts.

Is the financial institution maintaining a good debt to asset ratio? Dividend history can be a key indicator of their financial strength. Is the customer comfortable with the banking service fees? If the services fees associated with the account were too high, the return would mitigate the value of the investment. Would a checking account be a better way? This question will, be answered with another question. Does the depositor need to make few or many withdrawals each month? When a customer takes, all their money out there is no money to earn interest. Financial institutions use money market account deposits to invest in T-bills, CD’s, mutual funds, or other investments. The financial institution’s managers react quickly to market trends thereby getting the greatest return for the dollar. One of the many advantages of a money market account is the ability to deposit into the account in the amount the customer chooses. Searching the website moneymarketaccount.net will yield answers to these and many other questions.

This article cannot answer every question that a depositor may ask; moreover, there are legal implications to any investment vehicle. As with many other investments, there are taxes to consider. Consulting with a tax or legal professionals will in most cases provide answers pertinent to the individual investor that can’t be answered by browsing the pages of moneymarketaccount.net. Any financial decisions should be carefully calculated to ensure full benefit. As J.G. Wentworth would say, “It’s your money…”

One such opportunity is at F&A Federal Credit Union, located in Monterey Park, CA 91754. This financial institution serves local government employees and their families. Similar alternative offers may be found at UFB Direct in San Diego, California and Incrediblebank in Wausau, Wisconsin.

Checking and Savings Accounts

Many financial companies charge their customers for even the most basic of checking accounts. Some banks provide checking accounts that require customers to spend time trying to figure out how to maximize their earning potential. Rather than do this, F&A instead offers a new hybrid checking and savings account. At a 1.26% APY rate, F&A’s High Yield eChecking account is competitive with the top national money market account rate, and is also right in line with the highest savings account rate available, as well.

F&A’s High Yield eChecking account combines the best attributes of checking and savings into one product. To get this new streamlined account, customers merely need to agree to sign on for eStatements to begin receiving a 1.26% APY immediately.

Customarily, many banks offering interest-bearing rewards-based accounts require that customers keep up with a minimum balance and transaction requirement. Some of the features of F&A’s High-Yield eChecking account that make it more beneficial for customers include that there is a) no monthly fee; and b) no minimum or maximum balance requirement associated with this type of account. Customers will also enjoy the fact that there is no number of transaction requirement each month.

Members of the F&A Federal Credit Union (www.fafcu.org) must either be a) employed by the L.A. County Fire Department , b) a city that contracts with them, c) an employee of another approved area government entity, or d) related to a family member that qualifies under those guidelines.

UFB Direct

Those who are ineligible to join F&A may apply for another high-rate national savings account. UFB Direct (www.ufbdirect.com) has a 1.30% APY available with their Airline Rewards Savings Account. Another benefit of this account are the chance to earn free reward airline miles. UFB is based in San Diego, California and is a subdivision of the former Bank of Internet USA – now BofI Federal Bank, also San Diego based.

Money Markets

F&A also provides competitive rates on CDs and money market accounts. F&A offers its competitive CD rates for five different terms, all of which are higher than even the best available national offers on CD Rates Leaderboards. Here are the CD rates for a minimum deposit of only $1,000:

6 months: 1.16% APY
12 months: 1.26% APY
24-months: 1.46% APY
36-months: 1.77% APY
60-months: 2.43% APY.

F&A members may sign up for CDs either via the mail services or through the credit union’s only office, which is located at 2625 Corporate Place, Monterey Park, California 91754.

Incrediblebank

The highest yield national money market account is offered by Incrediblebank, based in Wausau Wisconsin. Their MM pays out 1.18% APY on account balances from $2,500 to $249,999; higher balances can yield a 0.80% APY.This means you can earn 1.16% APY on a money market account with a $2,500 minimum deposit.

Compare all of these accounts to the highest savings account, CD and money market rates from our comprehensive collection of financial institutions at MoneyMarketAccount.net.

The yield on money market mutual funds has been the same for the last month. The Money Fund Report, a subsidiary of iMoneyNet, has reported the seven day average yield to be 0.02%. This is the same yield that was reported last week. The 30 day yields on mutual fund investments is also unchanged, and this is also at 0.02%. Many analysts are concerned about the static interest rate as investments increase. MoneyMarketAccount.net has many blogs that provide detailed account information about the most heavily traded mutual funds. They continually update the information on their pages, and a host of analysts have been commenting on this recent trend. Most analysts express optimism with the way the market has been acting. Some are even surprised that the yields are unchanged. Many expected an influx of capital to lower the yields. This is the one bright spot of the market. Interest rates across the board are at an all time low, and many investors are concerned about this issue.

Interest bearing checking accounts also kept the same interest rates, reported Bankrate.com. The annual percentage yield on these accounts is steady at 0.06%. Bankrate.com also quoted the annual percentage yields for money market accounts to be the same for the last two weeks. This yield rests steady at 0.14%. Market analysts have expressed reserved optimism about this issue. Most would like to see the rates rise a little. However, with the increased amount of capital that has been entering these markets, many believe that these rates may even go down in the coming weeks. MoneyMarketAccount.net has also expressed concern about the recent developments. Many experts fully expect yields to drop in the coming weeks. If the amount of capital continues to increase at present rates, then the yields have to drop a little to compensate for the increased supply of capital.

Bankrate.com has also been monitoring the yields on other types of accounts. They have reported an annual percentage yield of 0.22% on six month certificates of deposit. One year CD’s has also remained steady, and the yield for these accounts is currently at 0.35%. 2-1/2 year CD’s have noticed a recent drop on their yields. Their yield is currently at 0.54%. This is down from the last reporting which pegged the yield of these deposits at 0.55%. Five year CD’s have also had their yields drop. They are down to 1.17%, from the last reports, which had them at 1.18%. This is in keeping with what analysts have expected. When more capital is made available to these accounts, the yields usually decline. This decline is closely related to the increased supply of capital that is available to borrowers. MoneyMarketAccount.net has regularly reported on this issue, and many of their reports have also confirmed the general trend in the marketplace. Investors have been encouraged to keep a portion of their portfolios in these secured accounts.

August 2011 was a wild ride for US money market rates. The debt ceiling was raised on August 2, and Standard and Poor’s downgraded U.S. sovereign debt on Friday of that week. These developments did not impact the money market in the ways that outside commentators expected. In fact, investors seemed to rush to downgraded US Treasury bonds, pushing the benchmark 10-year yield close to 2 percent. Later in the month, worries about a second global downturn drove further demand for U.S. debt, pushing 10-year yields below 2 percent for the first time ever. (1)

These low rates have spelled out bad news for money market mutual funds and the money market in general. The money market is the place where short-term debt securities are bought and sold by corporations and banks. Banks use the market to fulfill reserve requirements and satisfy depositor demands. Corporations issue short-term debt securities to fund their operations and meet other obligations. The money market plays an essential role in the economy, and its freeze in 2008 spelled doom for corporations and banks before the Federal Reserve intervened.

Today, conditions in the money market are pointing to a renewed crisis down the road. Unlike 2008, the inflation rate as measured by the Consumer Price Index is much higher at 3.6 percent. (2) The Federal Reserve publicly committed to keep interest rates at near zero for at least another two years. These two developments are delivering a real beating to money market accounts and mutual funds. With real interest rates negative, money market accounts are losing value. Combining this with the intensifying European debt crisis and a scrambling for cash as a result of Hurricane Irene, the forseeable future of the money market is looking grim.

The Federal Reserve has effectively locked in the short end of the yield curve, forcing investors to pursue riskier assets at the longer end. With higher inflation and fears of European contagion, the money market has been shoring itself up recently. In fact, total assets have been decreased by over $2 billion as investors pull their money. (3) European government debt woes have undoubtedly played their part in this. If the European Union collapses under the weight of its own debt, several European banks may fail, sending a fresh wave of horror through financial markets.

The financial crisis of 2008 wreaked havoc on the money market. Money market accounts and money market mutual funds suddenly froze as sources of cash collapsed. A large money market mutual fund, the Reserve Primary Fund, had its shares trade below $1, resulting in a bailout. The Federal Reserve’s actions during the crisis, lowering the Federal Funds Rate to effectively 0 percent and engaging in massive liquidity operations, further harmed the money market. Today, the average rate of return on a taxable money market mutual fund is a pathetic .04 percent. This is a far cry from the average of 5 percent in 2007, according to the research firm Crane Data LLC. (1)

Money market funds have been closing one after another, thanks to disastrously low interest rates. The Investment Company Institute, an industry trade group, reports that the number of money funds has dropped over 20 percent. Furthermore, many money market mutual funds are exposed to toxic European debt, raising the risk of another crisis in the money market if the European debt crisis leads to default. (2) 2008 would be repeated all over again, except on a global scale. The money market is imperiled by negative economic conditions, putting investors in a painful position.

Conservative investors who have a significant allocation to cash equivalents like a money market account seem to be at a loss. Rates are so low that even moderate official inflation, reported at 3.6 percent in June 2011, eats away at their money. The shrinking number of money market mutual funds portends further bad news for this market. Even rates paid on a high-yield money market account are devastatingly low. For instance, according to the website RateCatcher, the highest yield on a money market account is offered by Sallie Mae at 1.15 percent. With a 3.6 official inflation rate, this works out to a real loss of -2.45 percent. (3)

The money market may yet see some good news in the future. Yields on 10-year Treasurys rise and fall in response to the economic outlook. The Federal Reserve’s announcement of a second round of quantitative easing in November sent yields on the 10-year shooting upward as investors moved from bonds to stocks. 10-year yields peaked at just over 3.6 percent before falling again due to renewed economic concerns. (4) As the economy slowly recovers, yields should recover, too, giving money market account investors a second lease on life.

Money Markey Accounts:  A Great Way to Save Is Not Spending

Everyday we all spend money we probably do not need to: a candy bar, a movie, a new surround sound system, a new shirt.  Whatever the reason, it is hard to save money.  It is your money after all, right?  Why not spend it?  You may not want to spend for any number of reasons including a nice vacation, a new car, or emergencies like car repairs or medical reasons.  Whatever your reasons for wanting to save money, you may want to consider a savings account.  After all, a checking account is in place for you to spend not save.

A money market account may just be the perfect way for you to save that little bit of extra cash for that proverbial rainy day.  A money market account is simply a deposit account, much like a checking or savings account, and very easy to find one and open one.  They have better interest rates than most checking and savings accounts, making it a great way to earn money with your money, in addition to helping you save.

If you want unlimited access to your account, though, a money market account is probably not the best option for you.  Actually, the limited access is exactly what makes an MMA so valuable — out of sight, out of mind.  Banks encourage you to keep your fingers out of the dough with a few requirements.  You will most likely be limited to six transactions per month.  Any extra withdrawals will invite a financial slap on the wrist in the form of fees.  Also, most banks require to keep a minimum balance to open and sustain a money market account.  This amount may be pretty high, so plan ahead: begin saving and create a financial cushion, too.  The last thing you want to do is drop below the minimum.  Not all banks are the same, and some have hefty fees and others may even close your account if it stays in default for too long.  In this case, you would probably lose all interest earned on the account.

Another great way to keep your hands out of the cookie jar is to keep your accounts separate.  You may be offered the tantalizing option of linking your checking and money market accounts, or even linking to your debit.  Try to resist the carrot on the stick.  It is far easier to spend your money when it just a few button pushes or a swipe away.  Going to the bank might be just annoying enough to keep you from touching your money.  In addition, contemplate setting up an automatic deposit to further avoid using money that can easily help your account grow and gain more interest.

Money market accounts may be the easiest, painless way to keep your money out of your own hands.  But you may also want to consider CDs and CD Ladders.  What ever you choose comparing and shopping around is crucial to finding the best one for you.  It will undoubtedly pay you in long run.