Money Market vs. CD vs. Savings Accounts - A Comparison

Money Market Account vs Savings Account vs CD

No matter what the economy is doing, it’s always a good idea to have money put away for a rainy day or for big expenses coming down the road. But not enough consumers do this.

According to a survey, only 44% of U.S. adults had enough money saved to cover a $1,000 emergency. That leaves them vulnerable to unexpected expenses, such as car or home repairs or medical needs.

One key to saving money is to just begin, however you can. Do you know the differences between money markets, certificates of deposit and savings accounts? Find out which might be best for you, depending on your needs and how much you can put away.

Take a look at the table below or download the infographic to find out the differences between money market, savings and CDs.

Cadence can help you begin saving with certificates of deposit, money markets and savings accounts. Contact us to learn more.

Comparing Money Market Account vs.
Savings Account vs. CD

	Certificate of Deposit	Money Market	Savings Account
How it works	Certificates of Deposit (CDs) offer you a higher rate of interest than a savings account. In exchange, you agree to leave the money in the account for a certain length of time - three months, six months, one year or five years, for example.	Money market accounts are for higher balances and offer variable interest rates. You’ll have access to the cash with certain limits. A money market acts as a savings account with some checking features.	Savings accounts are for putting away smaller amounts. You can deposit at any time and potentially earn a small amount of interest.
Interest rates	Fixed rates are higher than regular savings accounts and may be higher than money market accounts. The longer the term, the higher the interest rate.	Tiered interest rates, depending upon the amount in your account.	Smaller interest rates than money markets and CDs.
Advantages	Higher interest rates than savings accounts Interest rate won’t change No fees when you let your account mature FDIC insured	Relatively high interest rates compared to checking and savings Ability to write checks, make withdrawals by ATM and electronic transfers FDIC insured	Low to no minimum balance requirements Low to no fees Accessible via ATM and electronic transfers FDIC insured
Disadvantages	No access to your money for a designated time frame Penalties for early withdrawal Might miss out on other investment opportunities	High minimum deposit to avoid fees Limited number of withdrawals per month Might still be too easy to spend	Low interest rates Limited number of withdrawals per month
What to use for...	Long-term savings Gift for a child College tuition Retirement savings Future down payment Large future purchase	Emergency fund Tax payment Vacation College tuition Home down payment	Emergency fund Teaching a child to save Vacation in a few months Short-term savings
What NOT to use for...	Short-term savings Emergency withdrawals	Regular expenses Short-term savings	Regular expenses Future down payment College tuition
How to apply	Open a CD	Open a money market account	Open a savings account

This article is provided as a free service to you and is for general informational purposes only. Cadence Bank makes no representations or warranties as to the accuracy, completeness or timeliness of the content in the article. The article is not intended to provide legal, accounting or tax advice and should not be relied upon for such purposes.

Download the infographic