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The Federal Reserve cut its target interest rate three times in 2024, and as a result, deposit rates, including money market account rates, have started to fall. It’s more important than ever to compare MMA rates and make sure you’re getting the most out of your balance.
The national average money market account rate it stands at 0.66%, according to the FDIC. This may not seem like much, but consider that three years ago, it was only 0.07%, reflecting a sharp increase in a short period of time.
This is largely due to the Fed’s monetary policy decisions, which began raising its benchmark rate in March 2022 to combat soaring inflation. In fact, the Fed raised rates 11 times. But it eventually cut its benchmark rate three times by the end of 2024, causing rates on deposit accounts to start falling.
Even so, some of the top accounts currently offer more than 4% APY. Since these rates may not be around for long, consider opening a money market account now to take advantage of today’s high rates.
Here’s a look at some of the best MMA fare available today:
Check out our picks for the 10 best money market accounts available today >>
Additionally, the table below includes some of the best savings account and money market rates available today to our verified members.
The amount of interest you can earn with a money market account depends on the annual percentage rate (APY). This is a measure of your total earnings after one year if you factor in the base interest rate and how often the interest is compounded (money market account interest is typically compounded daily).
Let’s say you put $1,000 into an MMA at the average interest rate of 0.66% with daily compounding. At the end of one year, your balance would increase to $1,006.62: your initial deposit of $1,000, plus just $6.62 in interest.
Now let’s say you choose a high-yield money market account that offers 5% APY. In this case, your balance would increase to $1,051.27 over the same period, which includes $51.27 in interest.
The more you deposit in a money market account, the more you earn. If we took the same example of a money market account at 5% APY, but deposited $10,000, the total balance after one year would be $10,512.67, which means you would earn $512.67 in interest.
