A high yield money market account is a type of savings account that typically offers higher interest rates than traditional savings accounts.
The interest rate is usually higher because the financial institution invests the funds in low-risk securities, such as government bonds or certificates of deposit (CDs), to generate a higher return.
Because the investments are low-risk, the account holder’s funds are generally safe, but there is always some risk involved.
Like a traditional savings account, a high yield money market account allows account holders to deposit and withdraw money at any time.
The account typically comes with a debit card or checks, which allows account holders to access their funds easily.
However, there may be limits on the number of withdrawals or transfers that can be made in a given period.
Financial institutions that offer high yield money market accounts may also have certain requirements, such as a minimum balance or a monthly maintenance fee.
Account holders should read the terms and conditions carefully before opening an account to ensure they understand the requirements and any associated fees.