What is a Money Market Deposit Account?

A Money Market Deposit Account is primarily characterized by being a high-yield savings account that typically offers a higher interest rate compared to regular savings accounts. This type of account allows for limited withdrawals and transfers, making it less liquid than a standard checking account, but still more liquid than long-term investments. There are usually restrictions on the number of transactions that can occur each month, aligning with regulations for money market accounts.

The benefits of a Money Market Deposit Account include the ability to earn a higher interest rate while still maintaining relatively easy access to funds, although it is important to note that certain transaction limits do apply. This design makes it an attractive option for individuals looking to save while still having the flexibility to withdraw funds when needed.