Checking Accounts how they Diff from Money Market Accounts

Money market accounts and checking accounts can be opened at virtually any financial institution. They are both insured, either by the FDIC if they are opened at a bank or by the NCUA if they are opened at a credit union. Because of the insurance, either account you deposit your money into is 100% safe, there is no risk of losing any funds on deposit.  It is very easy to make deposits to or withdrawals from both types of accounts. With both accounts, you receive a check book as a means to access the funds. However, they are very different types of accounts. This article will explain the differences between the two accounts. 

Checking Accounts

A checking account is your primary spending account. This is the account where you likely deposit your pay check. It is also the account you likely use to pay your bills from. You have a checkbook to access your account as well as a debit card. Typically, there are no restrictions on how many checks your write, or the amounts of the checks written. There is no limit on how many debit transactions there are, given funds are available to clear them.  You can also have unlimited transfers to or from the account per month. Checking accounts usually come with an option for online Bill Pay. 

Money Market Accounts

A money market account is a type of savings account.  Investors often deposit funds into money markets because they pay a greater rate of return than a savings account.  Although you receive a check book as a means to access funds in this type of account, there are restrictions to their use. You are only able to write a limited number of checks per month and they typically have to be in amounts greater than $100. There is also a limit on the number of times funds can be transferred out of the account per month. Due to Regulation D, there can only be six outgoing transactions per month between the checks and the transfers.  Some people choose to link their money market account to their checking account as an overdraft protection source to avoid overdraft or bounced check fees. 

As you can see, the accounts are very different, but are both useful in their own ways. A lot of people actually have both types of accounts as they complement each other.