Money Market Account Vs CD
By kingparker
@kingparker (9673)
United States
February 2, 2011 3:28pm CST
On my previous discussion I posted here, I talk about those teller might need some practical training when customers ask them about certain product. Yesterday, actually, I didn't have a CD open, I open a money market account to earn some interest from my checking and saving both. According to the banker's information, CD won't earn me much interest rate, but Money Market Account will right now. So, when the economy is up, CD might be the best choice for me. I just wonder, money market account and CD both products introduced by banks, what is the different, and what is their advantage and disadvantage?
You know what, the bankers didn't tell me much and they since have limited knowledge about it. They only tell me the good thing about them, but they never tell me the disadvantage, or restrictions on those products.
1 person likes this
1 response
@BrianDaniel (256)
• United States
2 Feb 11
Money market accounts are like savings accounts. You can add and subtract money at will. You'll have flexibility with this account but the interest rate will be low. If you'll need the money in the next year or so, use a savings or money market.
Certificates of deposit (CD) are better for monies that you won't be needing for a defined period of time, say 6 months, one year, or three years. You would only open a CD if you are sure you won't use the money. The bank will pay you a higher rate of interest for you "locking up" your money. At the same time, in an emergency, you can still withdraw the money from a CD, but you will have to pay a penalty.
@kingparker (9673)
• United States
3 Feb 11
You know what, I told that lady, the banker I can put away some money for 12 months period of time without using it, she encourages me to open a money market saving account. And she didn't explain much. And when I ask her, if that give me more interest, I would more than glad too. She is more like a Hispanic translator type of person, maybe she doesn't know much what she is doing.
@rosegardens (3034)
• United States
3 Feb 11
they did not tell you the difference, or the disadvantages? 
You can look up on your banks website and see what the rates are for the cd and moneymarket. At least, I think the rates may be available on the website. I am surprised they did not have any literature on it, and/or a kiosk showing the cd rates. My bank does.
I do believe the moneymarket may give a bit better rate than a cd.
You can look up on your banks website and see what the rates are for the cd and moneymarket. At least, I think the rates may be available on the website. I am surprised they did not have any literature on it, and/or a kiosk showing the cd rates. My bank does.
I do believe the moneymarket may give a bit better rate than a cd.