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What is a money market account?

A money market account is a type of account offered by banks and credit unions. Like other deposit accounts, money market accounts are insured by the FDIC or NCUA, up to $250,000 held by the same owner or owners.

Money market accounts tend to pay you higher interest rates than other types of savings accounts. On the other hand, money market accounts usually limit the number of transactions you can make by check, debit card, or electronic transfer. Usually you can make unlimited withdrawals and payments by using an ATM or by making the withdrawal in person, by mail, or by telephone. A money market account might require a minimum amount to be deposited.

If you have multiple accounts with a bank or credit union, talk to your bank or credit union to confirm your FDIC or NCUA insurance coverage.

What’s the difference between a money market account and money market mutual fund account?

A money market mutual fund account is considered an investment, and it is not a savings or checking account, even though some money market funds allow you to write checks. Mutual funds are offered by brokerage firms and fund companies, and some of those businesses have similar names and could be related to banks and credit unions—but they follow different regulations. For information about insurance coverage for money market mutual fund accounts, in case your brokerage firm fails, see the Securities Investor Protection Corporation (SIPC) .

To look up your account’s FDIC protection, visit the Electronic Deposit Insurance Estimator or call the FDIC Call Center at (877) 275-3342 (877-ASK-FDIC). For the hearing impaired, call (800) 877-8339.

Accounts at credit unions are insured in a similar way in case the credit union’s business fails, by the National Credit Union Association (NCUA). You can use their web tool to verify your credit union account insurance.