Bank Money Market Accounts Better than Money Funds, Savings Accounts, and CDs?

One of the best places to park cash today might be bank money market accounts which offer yields that beat mutual fund money market accounts and offer more flexibility than savings accounts or CDs. Money funds offered by the largest mutual fund companies like Fidelity, Vanguard, and Dreyfus are currently yielding between 2.00% and 2.45% - well below the large number of +3.00% yields available from online banks on their money market accounts. While savings accounts do not allow check-writing privileges and CDs have penalties for early withdrawal, bank money market accounts offer limited check-writing and no penalties for withdrawals. Also in an increasing-rate environment (which is widely anticipated for the remainder of 2008 and into 2009) a consumer has an advantage in a money market account because banks typically increase their money market rate quicker than their savings rates and the consumer is not locked-in to a lower rate on a CD. It is also easier to switch banks to find a higher rate if the original bank does not increase their rates accordingly.

Top 50 Highest Money Market Rates posted on Money-Rates.com

EverBank 4.76% APY (introductory offer), minimum $1,500

First East Side Savings Bank 3.75% APY, minimum $100,000

TriState Capital Direct 3.75% APY, minimum $95,000

Corus Bank 3.85% APY, minimum $10,000

Union Federal Savings Bank 3.75% APY, minimum $1

Wachovia Bank 3.75% APY, minimum $10,000

IndyMac Federal Bank 3.70% APY, minimum $50,000

Imperial Capital Bank 3.65% APY, minimum $100,000

Virtual Bank 3.56% APY, minimum $50,000

Zions Bank 3.56% APY, minimum $2,500

Amegy Bank of Texas 3.55% APY, minimum $10,000

Nationwide Bank 3.52% APY, minimum $1,000

Seacoast Commerce Bank 3.52% APY, minimum $25,000

Century Bank Direct 3.57% APY, minimum $1,000

Flagstar Bank 3.50% APY, minimum $1

Bank Mutual 3.51% APY, minimum $25,000

Bank Excel 3.50% APY, minimum $10,000

OnBank 3.50% APY, minimum $1

Bank of Internet 3.46% APY, minimum $1

California First National Bank 3.40% APY, minimum $1

Intervest National Bank 3.40% APY, minimum $2,500

Kaiser Federal Bank 3.40% APY, minimum $75,000

Imperial Capital Bank 3.40% APY, minimum $50,000

Umbrella Bank 3.40% APY, minimum $1,000

AIG Bank 3.35% APY, minimum $50,000

WT Direct 3.31% APY, minimum $1

Virtual Bank 3.30% APY, minimum $25,000

Greystone Bank 3.30% APY, minimum $100,000

Bank Provident 3.30% APY, minimum $1

H&R Block Bank 3.25% APY, minimum $50,000

Acacia Federal Savings Bank 3.25% APY, minimum $125,000

M&T Bank 3.25% APY, minimum $1

Amegy Bank 3.20% APY, minimum $10,000

Advanta Bank 3.20% APY, minimum $50,000

AIG Bank 3.20% APY, minimum $10,000

Earthstar Bank 3.16% APY, minimum $100,000

Discover Bank 3.14% APY, minimum $50,000

GiantBank 3.11% APY, minimum $1,000

Advanta Bank 3.10% APY, minimum $50,000

Imperial Capital Bank 3.10% APY, minimum $25,000

Amboy Direct 3.05% APY, minimum $30,000

Virtual Bank 3.05% APY, minimum $10,000

Earthstar Bank 3.04% APY, minimum $75,000

KeyDirect 3.00% APY, minimum $1

GMAC Bank 3.00% APY, minimum $500

Domestic Bank 3.00% APY, minimum $2,500

First Banking Center 3.00% APY, minimum $250,000

Security Savings Bank 3.00% APY, minimum $1,000

Capital One Bank 3.00% APY, minimum $1

Stonebridge Bank 3.00% APY, minimum $1

Transportation Alliance Bank 3.00% APY, minimum $1,000

MetLife Bank 3.00% APY, minimum $25,000

UFB Direct 3.00% APY, minimum $50,000

View the complete list of money market rates