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Money market accounts and high-yield savings accounts both typically earn solid interest rates on deposits and keep your money safe, making them ideal for emergency funds and rainy days. So, how do you choose between them?
Overall, money market accounts offer more convenient access to your cash with fewer restrictions, but they typically come with higher deposit requirements. Savings accounts, on the other hand, very often have no or low deposit requirements, but they might restrict how you can access your cash (and/or how often). Learn more about the similarities and differences, as well as which accounts we recommend for each.
Money market vs. high-yield savings accounts
A money market account (MMA) is a deposit account that pays interest and blends some features of both savings and checking accounts. Namely, a money market account earns interest and often offers the ability to write checks directly from the account. Some money market accounts even provide debit cards and allow ATM withdrawals. MMAs can be a convenient place to keep larger chunks of money, like a down payment for a house or car, while still keeping your cash close at hand.
However, money market accounts often have higher minimum balance requirements (like $2,500, for example) and charge more in fees than many savings accounts.
High-yield savings accounts don't offer check-writing capabilities and may limit the number of monthly withdrawals, but they often have lower minimum balance requirements and may charge fewer or lower fees. If you're working on building up your savings, a savings account could be a suitable place for your money.
Here are some key differences between the two types of accounts:
| Money market accounts | High-yield savings accounts | |
| Account minimum | Can have a high account minimum or initial deposit | Often have low or no account minimum or initial deposit |
| Fees | May charge monthly fees if account minimum isn't met | Typically charge zero or low monthly fees |
| Interest rates/APYs |
|
|
| Spending methods |
|
|
| Best for ... | Saving with some flexibility to spend | Building savings you don't plan to dip into |
How do money market accounts work?
When you deposit funds into a money market account, the bank pays you periodic interest, often at a variable rate, on your balance. You can withdraw your funds at any time, and you usually receive a checkbook or debit card to spend from the account directly.
Money market accounts are useful if you need immediate access to your funds. You don't need to spend time making a withdrawal or transferring money to a checking account first.
Money market account vs. money market fund
Money market accounts are not money market funds, which are a type of mutual fund investment. Money market funds are designed to provide returns on your money, but they are subject to market risk since the funds invest in securities.
In contrast, money market accounts are a depository financial product similar to normal bank accounts. They are insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA), depending on whether your account is at a bank or a credit union. Money market funds are not FDIC-insured.
Pros and cons of money market accounts
According to the FDIC, the national average rate on money market accounts is 0.59% (as of 6/16/25), although some accounts offer higher rates.
Money market accounts often also have higher account minimums than savings or checking accounts, with some accounts requiring four-figure or even five-figure balances to earn the best interest rates.
Although you can make as many deposits as you'd like, some banks limit the number of monthly withdrawals you can take from the account. This limit is generally up to six before incurring penalties or fees.
Money market accounts we recommend
If a money market account sounds like a good fit, here are some of our favorite options.
- Discover® Bank: Discover Bank offers a range of banking products. The Discover® Money Market Account earns up to 3.45% (as of 06/26/25) APY, depending on the account balance. There is no minimum opening deposit requirement for a Discover money market account and no account-related fees.
- Ally Bank: Ally offers a money market account with no monthly maintenance fees and no minimum balance requirements. It has a 3.50% (as of 06/23/25) APY, and there's no minimum to open an account.
- Quontic Bank: Online-only Quontic Bank has offered one of the best money market accounts for years, earning up to 4.25% (as of 03/05/25) APY with a minimum deposit requirement of just $100.
Read more: Best Money Market Accounts
How do high-yield savings accounts work?
High-yield savings accounts are a type of savings account with a higher interest rate than your typical savings account. High-yield savings accounts are insured by the FDIC as well.
When you put money into a standard savings account, you may only earn a fraction of the interest you could earn in a high-yield savings account. The average national APY on a regular savings account is 0.38% (as of 6/16/25), according to the FDIC's data. However, big banks are notorious for paying even less than that and charging monthly account fees (you could earn as little as 0.01% APY with Chase Bank, for example).
Interest rates for high-yield savings accounts
High-yield savings accounts usually offer much higher rates. The APYs for some of the best high-yield savings accounts currently top 4.00%. Many of the highest-yield savings accounts are offered through online banks rather than traditional brick-and-mortar banks. These online banks tend to have lower overhead and can offer more competitive rates.
Keep in mind that the APY for a high-yield savings account is usually variable, meaning it changes with market conditions. If the Federal Reserve raises or lowers the target federal funds rate, for example, interest rates on high-yield savings accounts typically follow suit.
High-yield savings accounts could be a good place to put your emergency fund or save for short-term goals like an upcoming vacation.
High-yield savings accounts we recommend
/images/2024/07/31/sofi_logo_-_cropped.png){kind=logo}
2025 award winner Best Checking and Savings Combo
SoFi Checking and Savings Benefits
- Limited-Time Offer: Earn up to a $300 bonus and up to 4.00% APY on Savings (3.80% APY1 <p>New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Eligible Direct Deposit. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at <a href="https://www.sofi.com/banking/">sofi.com/banking</a>. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC.</p><p>SoFi members with Eligible Direct Deposit can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.80% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 1/24/25. There is no minimum balance requirement. Additional information can be found at <a href="http://www.sofi.com/legal/banking-rate-sheet" >http://www.sofi.com/legal/banking-rate-sheet</a>.</p> with +0.20% APY Boost) for 6 Months on new accounts with direct deposit. Terms Apply.2 <p>Earn up to 4.00% Annual Percentage Yield (APY) on SoFi Savings with a 0.20% APY Boost (added to the 3.80% APY as of 7/10/25) for up to 6 months. Open a new SoFi Checking & Savings account and enroll in SoFi Plus by 8/12/25. Rates variable, subject to change. Terms apply at <a href="https://www.sofi.com/banking/#2">sofi.com/banking#2</a>. SoFi Bank, N.A. Member FDIC.</p>
- No account, overdraft, or monthly fees3 <p>We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at <a href="http://sofi.com/legal/banking-fees/">sofi.com/legal/banking-fees/</a></p>
- Get your paycheck up to two days early4 <p>Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.</p>
- Access additional FDIC insurance up to $3 million5 <p><b style="font-family: Rubik, -apple-system, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", Arial, sans-serif;">SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/sidpterms">SoFi.com/banking/fdic/sidpterms</a>. See list of participating banks at <a href="http://sofi.com/banking/fdic/participatingbanks">SoFi.com/banking/fdic/participatingbanks</a>.</b></p>
Why we like both accounts
Whether you choose a high-yield savings account or a money market account, some of the benefits will be pretty similar: earning interest, FDIC insurance, and some protection against inflation.
Interest on your deposits
Both money market accounts and high-yield savings accounts offer easy access to your money with higher earning potential than a checking or traditional savings account.
Some banks offer their highest APY on money market or high-yield savings accounts with big account balances, with lower-tier balances earning less interest.
Other banks might offer the highest rates for balances up to a certain limit and offer lower APYs above that balance tier. If that's the case, it could make sense to open more than one savings account to avoid the limit and maximize your earnings.
FDIC insurance
Money market and high-yield savings accounts are automatically FDIC-insured for up to $250,000 per person, per bank, per account type. For joint accounts, each person on the account is insured up to $250,000. That means that if your bank should fail or go under, your money will be protected and returned to you up to FDIC limits.
Support against inflation
The higher APY you earn with money market accounts and high-yield savings accounts may help you maintain the value of your saved money during times of inflation.
For example, some money market and high-yield savings accounts offer interest rates of around 4% or more. That's higher than the 2.4% inflation rate recorded by the U.S. Bureau of Labor Statistics in May 2025.
Additional features
Money market and high-yield savings accounts offer greater flexibility and access to your money than a certificate of deposit (CD) or investments in the stock market. CDs lock up your cash for a period of time, and you could pay a penalty for withdrawing your funds early. Stock market investments require you to sell your investments to get your cash, which can take time and may not return the value you originally invested.
Money market and high-yield savings accounts welcome an unlimited number of deposits but may limit the number of withdrawals you can make each statement period, even imposing fees for exceeding maximum withdrawal limits. You might see some accounts restricting you to six monthly transactions, and others offering unlimited transactions.
Differences between high-yield savings and money market accounts
Although money market and high-yield savings accounts are similar in many ways, there are some distinct differences.
Depending on your initial deposit amount and what you intend to use those funds for, these five differences might help you determine the account type of account that's right for your financial goals.
1. Account minimums
Money market accounts often have high minimum balance requirements. Depending on the specific account, you may need to have thousands of dollars available to deposit.
High-yield savings accounts tend to have zero or low account minimums, and by doing some research, you might find a bank offering high-yield savings accounts with APY rates close to or even slightly above most money market accounts.
Winner: High-yield savings accounts. They often don't require high minimum deposits, making them more accessible to everyone.
2. Competitive rates
Money market accounts and high-yield savings accounts typically earn similar interest rates.
The national average APY for a money market account is 0.59% (as of 6/16/25), while some high-yield savings accounts are offering between 0.40% to 2.00%. These rates vary, and they depend on the specific account you open.
Winner: Tie. Both money market accounts and high-yield savings accounts offer competitive rates compared to traditional checking and savings accounts. Researching the account you might open would give you a clearer picture of how it compares to other products in the market.
3. Access to your money
A money market account offers more immediate access to your funds since you might be able to write checks or have access to a debit card. On the other hand, you can often connect a high-yield savings account to your checking account, which allows for transfers, though you must wait for the deposit to hit your checking account before you can spend it.
If you're prone to impulse buys or spending beyond your means, the extra time it takes to transfer money from high-yield savings to your checking account might be a good buffer for protecting your cash.
Winner: Money market accounts. They tend to offer faster access to your funds (but this could be an undesired feature based on your spending habits).
4. Fees
In general, money market accounts tend to have more potential maintenance fees than the average high-yield savings account.
You're more likely to be required to keep a minimum daily balance on your account, and if you drop below that amount, you may be charged a fee. You may also be subject to fees if you go over the monthly withdrawal limits. Be sure to read any fine print before opening an account.
High-yield savings accounts tend to charge zero fees for maintaining a low account balance, although some do have minimum requirements. Pay attention to the fine print and fee schedules for each type of account as you shop around for the best banks.
Winner: High-yield savings accounts. They're more likely to have zero or low fees.
5. Access to physical locations
Although some money market accounts are offered through online banks, many are available at national banks with brick-and-mortar locations. If you want to visit a local branch or make a withdrawal in person and still earn higher interest rates, you may be better off with a money market account.
High-yield savings accounts with the highest APY are usually found at online banks. Online banks don't have the same overhead costs as conventional banks, so they can pass those savings on to customers through better rates.
Winner: Money market accounts. You're more likely to find a bank with physical branches offering money market accounts than high-yield savings accounts.
Which bank account should you choose?
Choosing between a money market and a high-yield savings account depends on your specific needs and goals, so you'll need to figure out what is a priority for you.
When you should choose a money market account
Money market accounts may be a better fit for people who:
- Have a higher savings balance
- Want easy access to funds through checks or debit cards
- Can meet money market account minimums
- Can afford higher fees
If you are saving to make a big purchase and you can meet the account minimums, a money market could offer high interest rates while allowing direct access to your money.
When you should choose a high-yield savings account
High-yield savings accounts could be the right choice for people who:
- Have a lower savings balance
- Don't want minimum balance requirements
- Want to avoid or minimize fees
- Don't mind leaving their money to grow
With a high-yield savings account, you could earn a high interest rate on your money even if you have a lower balance. The zero or low minimum balance requirements on some high-yield savings accounts also mean that you could break up your money into more than one savings account for various goals. You could have different accounts for vacation funds, sinking funds, emergency funds, and more.
FAQs
Can you lose money in a money market account?
You aren't likely to lose money in a money market account. Money market accounts are insured by the FDIC or the NCUA. This insurance covers up to the $250,000 limit per depositor, or more for joint accounts, if your bank experiences theft or failure.
Be careful not to confuse money market accounts with money market funds, a type of investment mutual fund. While money market funds might have a relatively low risk compared to other mutual funds, they are not insured by the FDIC and do carry some risk.
Are high-yield savings accounts worth it?
High-yield savings accounts can be worth having as a financial tool to earn high interest on your emergency fund or savings. They often have zero or low account minimums, making them more accessible for people who may not be able to meet the minimum balance requirement of a money market account.
Some high-yield savings accounts require you to transfer money into a linked checking account to use your funds. This might be a helpful barrier for someone who wants a little help controlling their spending habits.
Is money market or high-yield savings better?
Whether a money market or a high-yield savings account is better depends on your goals and preferences. Both offer higher interest earnings than traditional savings accounts and have features that make them attractive to savers.
Money market accounts blend a savings account with checking account features and offer a relatively high APY, although account minimums may be a barrier for some. High-yield savings accounts tend to offer comparable interest rates to money market accounts but with lower minimum balances and fees.
A money market account might fit someone looking to put a down payment for a home or car in a high-interest account while they shop around. If you need a place to put your emergency fund and have a smaller sum of cash, a high-yield savings account might work better for you.
Bottom line
Both money market accounts and high-yield savings accounts offer a safe way to save and let you earn a higher APY than you could with a traditional savings account. The right one for you depends on how much you have saved and how easily you'd like to access your cash.
While finding the highest interest rates may seem like the most important thing, don't chase the best rate without giving your money time to grow.
Do your research by checking out which money market and high-yield savings accounts currently offer the best rates with the features you need. We've compiled a list of the best money market accounts and best savings account recommendations to help you find the right fit.
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2025 award winner Best Checking and Savings Combo
SoFi Checking and Savings Benefits
- Limited-Time Offer: Earn up to a $300 bonus and up to 4.00% APY on Savings (3.80% APY1 <p>New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Eligible Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Eligible Direct Deposit. If you have satisfied the Eligible Direct Deposit requirements but have not received a cash bonus in your Checking account, please contact us at 855-456-7634 with the details of your Eligible Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at <a href="https://www.sofi.com/banking/">sofi.com/banking</a>. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC.</p><p>SoFi members with Eligible Direct Deposit can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Eligible Direct Deposit amount required to qualify for the 3.80% APY for savings (including Vaults). Members without Eligible Direct Deposit will earn 1.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of 1/24/25. There is no minimum balance requirement. Additional information can be found at <a href="http://www.sofi.com/legal/banking-rate-sheet" >http://www.sofi.com/legal/banking-rate-sheet</a>.</p> with +0.20% APY Boost) for 6 Months on new accounts with direct deposit. Terms Apply.2 <p>Earn up to 4.00% Annual Percentage Yield (APY) on SoFi Savings with a 0.20% APY Boost (added to the 3.80% APY as of 7/10/25) for up to 6 months. Open a new SoFi Checking & Savings account and enroll in SoFi Plus by 8/12/25. Rates variable, subject to change. Terms apply at <a href="https://www.sofi.com/banking/#2">sofi.com/banking#2</a>. SoFi Bank, N.A. Member FDIC.</p>
- No account, overdraft, or monthly fees3 <p>We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at <a href="http://sofi.com/legal/banking-fees/">sofi.com/legal/banking-fees/</a></p>
- Get your paycheck up to two days early4 <p>Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.</p>
- Access additional FDIC insurance up to $3 million5 <p><b style="font-family: Rubik, -apple-system, BlinkMacSystemFont, "Segoe UI", Roboto, "Helvetica Neue", Arial, sans-serif;">SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/sidpterms">SoFi.com/banking/fdic/sidpterms</a>. See list of participating banks at <a href="http://sofi.com/banking/fdic/participatingbanks">SoFi.com/banking/fdic/participatingbanks</a>.</b></p>
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