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Deposit Account Basics for Beginners and New Savers

We've put together a summary of different types of deposit accounts below, to help you find the best savings option(s) for you depending on your financial goals, timing and flexibility.

High-Yield Savings Account

A high-yield savings account is a type of bank account offered by traditional banks and online banks. These accounts typically offer a higher interest rate while still maintaining easy access to your funds. Compared to a traditional savings account, a high-yield savings account typically requires a larger opening deposit and can sometimes require an initial minimum deposit and/or minimum monthly balance.

Key Features:

  • Interest Rate: Typically offers a better interest rate than a standard savings account to help you earn more.
  • Flexibility: Easily access your funds through online/mobile banking and ATMs. Some banks also offer in-person account access so do your research if accessing funds through your local branch is important to you.
  • No Fixed Term: No fixed term or maturity date so you can withdraw funds whenever you want.
  • Insurance: Check your bank or credit union to ensure they have FDIC/NCUA insurance. 
Money Market Account (MMA)

Similar to a high-yield savings account, a money market account is another type of savings account offered by banks and credit unions. A money market account typically has a higher interest rate but limited monthly transactions so it can be harder to access your funds.

Key Features:

  • Interest Rate: Interest rates tend to be slightly higher than standard savings accounts but the rates may be lower than those of high-yield savings accounts.
  • Flexibility: Some money market accounts allow limited check-writing capabilities, but there might be restrictions on the number of checks you can write each month.
  • Minimum Balance: Money market accounts may require a higher minimum balance to open and maintain the account compared to high-yield savings accounts.
  • Insurance: Check your bank or credit union to ensure they have FDIC/NCUA insurance.
Certificate of Deposit

Also referred to as a CD, this type of high-yield savings account has a fixed interest rate for a specific period of time. So, you get higher interest in exchange for not touching your money for a certain length of time.

Key Features:

  • Interest Rate: CDs generally offer higher interest rates than both high-yield savings and money market accounts due to the commitment to keep the money in the account for a fixed period.
  • Flexibility: CDs have a fixed term, which can range from a few months to several years. During this period, you cannot withdraw the funds without paying an early withdrawal penalty. 
  • Insurance:  Check your bank or credit union to ensure they have FDIC/NCUA insurance.


All facts represented in the article were accurate at the time of publication. This article does not represent financial advice or recommendations. The content is intended for informational purposes only, and readers should seek professional advice before acting on it.