Key insights:
- A money market account works similarly to a traditional savings account by allowing you to earn interest on your deposited funds
- You might need to meet certain requirements, like a minimum opening deposit, to open a new account
- Gathering documents like your government-issued ID and bills in your name will help speed up the application process
- Comparing annual percentage yields and fee structures across different banks helps you find the right fit for your financial goals
A money market account (MMA) works much like a savings account. Once you open it, you may deposit funds and earn interest. Depending on the bank, the account may also have withdrawal transaction limits. The process of opening a money market account is generally the same as opening a savings account.
MMAs can offer a convenient way to build your savings over time while keeping your funds accessible. Let's walk through the 5 steps you need to complete to open this type of account.
Step 1: Compare your options
The first step in choosing a money market account is to review the options offered by banks. Some banks may have different requirements and annual percentage yields (APYs). Your APY measures how much you would earn each year for storing money in the account.
The APY may be the most important factor for those who prioritize growing their savings. However, it’s not the only consideration when shopping around for a money market account. You may also want to think about:
- Fees: Many accounts charge monthly service fees, though some banks offer ways to waive them if you meet certain balance or deposit criteria
- Minimum balance requirements: Some banks require you to maintain a specific balance to keep the account open or avoid monthly maintenance fees
- Opening deposit requirements: You might need to make a minimum initial deposit to successfully open the new account
- Withdrawal transaction limits: Financial institutions may restrict the number of withdrawals or transfers you make each month
- Account features: Certain accounts offer check-writing privileges and debit cards for easier access to your funds
The type of bank could be another important factor. For example, brick-and-mortar banks usually let you make cash deposits, while online-only banks may not. Finding a bank that aligns with your daily habits can make managing your finances much more convenient.
Step 2: Gather required documents
To apply for an MMA, you typically have to provide the same information as you would if you were opening a savings account. This could include personal information such as your name, address, contact information and Social Security number or Individual Taxpayer Identification Number. You may also need to provide a valid government-issued ID and a second form of ID, such as a birth certificate or a bill in your name.
Having these documents ready before you begin the application can help you complete the process faster.
Step 3: Apply for the money market account
Depending on the bank, you may be able to apply for an MMA in person, online or via your bank’s mobile app. While the application process may vary by financial institution, applying online or through an app is convenient and typically takes just a few minutes.
Generally, you’ll need to provide the documents listed above during the application process. That way, the bank can check your ChexSystems report, which includes previous banking activity and actions. This routine check helps the bank verify your identity and banking history.
Step 4: Fund the account
Once approved, you can make an opening deposit to fund your money market account. You may be able to use an electronic transfer, debit card or cash to open one, depending on the bank.
Remember that you might have to meet a minimum opening deposit requirement depending on your bank or the account. If you open the account online, an electronic transfer from a linked checking account is often the funding method.
Step 5: Start using your account
After you’ve funded your account, you may want to take additional steps to make it easier to use your MMA. For instance, you could set up online banking to access your account online. Or you might link your money market account to external bank accounts to set up automatic transfers.
Automatic transfers can help you build your savings consistently without having to think about it. Ideally, you will keep adding to your savings account until you meet your financial goal.
Open your next account with Citi
A money market account gives you a dedicated place to store your funds while earning interest. Finding the right one involves comparing your options, applying and funding the account.
While Citi doesn’t offer money market accounts, you can still open a flexible, interest-earning savings account with Citi. When you choose to bank and save with Citi, you gain access to digital tools, including 24/7 mobile banking features, that help you manage your money on your terms.
Explore and compare Citi® Savings Account interest rates today to find the right fit for your financial goals.
Money market account FAQs
How much money is needed to open a money market account?
The amount of money required to open a money market account depends entirely on the financial institution. Some banks have no minimum opening deposit to get started. Others might require $100 or even $1,000 to open the account.
What is a good amount to start a money market account?
A good amount to start a money market account depends on your personal financial goals and the specific bank's requirements. You might want to deposit enough to avoid monthly maintenance fees or to qualify for a higher APY. Reviewing the account terms can help you decide the right initial deposit for your specific situation.
How much will $10,000 make in a money market account?
The amount a $10,000 deposit earns in a money market account depends on the bank’s current interest rate. For example, if you deposit $10,000 into an account with a 0.56% APY you would earn $56 in interest over 1 year without any monthly contributions. Rates vary widely by institution, so comparing options could help you maximize your earnings.
Disclosure: This article is for general educational purposes. It is not intended to provide financial advice. It also is not intended to completely describe any Citi product or service. You should refer to the terms and conditions financial institutions provide for various products.
