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What's the difference between a money market and a savings account?

Money Market Account vs Savings Account

While both accounts are intended to help you save and essentially work the same way, there are a few fundamental differences between a money market and a savings account.

Mature couple smiling while going over savings account options with financial advisor

What is a Savings Account?

This helps you…wait for it…save your money! Savings accounts tend to offer lower interest rates than a money market, and it is a safe, and easy access option to help you set aside cash for smaller goals. There isn't usually a minimum balance requirement, so you don't have to keep as much in it, so it's easy to stash money away for a weekend trip or new furniture.

You also have the option to automatically schedule small payments to be set aside in savings, say $20 per paycheck. It might not seem like much, but that adds up to about $520 in a year!

What is a Money Market Account?

It's a little confusing, but a money market account is somewhere between a savings and checking account, but it functions just like a savings account does (but with the option to write checks!) so you have more flexibility with this account.

Be aware, most of the time a money market does have a monthly maintenance fee, which makes sense if they're offering a higher interest rate than a free savings account. You can usually avoid this fee if you keep a specified minimum balance in the account, and you can earn more if you keep more money in the account, since interest rates are usually tiered.

If you need a secure account to help you save for a bigger goal, like a large vacation, emergency fund or a home project, this is a great option, especially since you can write checks as your home project progresses (if that's your goal).


Both are low-cost accounts with relative flexibility, designed to help people save money. Unlike other money-saving products, like a certificate of deposit (CD) or an investment account that you might purchase through a broker or investor, savings and money market accounts allow you to add, use, or withdraw your funds without much restriction.

Most institutions also allow a savings or money market account to be tied to a checking account as a "backup" in case you overdraw your checking account. You also have the option in some cases to get a debit card that is connected to either account type if you're interested.

Although federally these accounts are no longer limited to six transactions every month, your bank or credit union might still have a rule in effect, so double check before you start moving your money so you don't get charged any potential fees.

Interest rates on money market and savings accounts also vary by institution, but generally pay between 0.10% and 1.00%. As long as your bank or credit union is FDIC or NCUA insured, then your deposits up to $250,000 are covered, per depositor, per ownership category.

Want to start saving?

We're here to help. Contact your local branch to find out more about how you can start setting more money aside, or learn more about our savings products and how they could benefit you.


Find your local WaFd Bank Branch


Find your local WaFd Bank Branch

We're nearby, and we'll sit down with you and answer any questions you may have.