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How to Open a Money Market Account

If you're looking to diversify your savings strategy, a money market account (MMA) might be just what you need. This type of account often offers higher interest rates than regular savings accounts and provides an excellent balance of accessibility and growth potential. 

Although both banks and credit unions offer MMAs, many people prefer credit unions due to their member-focused philosophy and often superior rates. This step-by-step guide will show you how to open a money market account at a credit union.

THE EASY SIX-STEP PROCESS TO OPENING A MONEY MARKET ACCOUNT

A money market account can be an excellent addition to your savings portfolio as it offers the best of both worlds of a checking and savings account. The first step towards opening an MMA is determining if it’s the right investment option for you.

STEP 1: IS A MONEY MARKET ACCOUNT RIGHT FOR YOU?

Money market accounts are an excellent tool for saving, but they aren't for everyone. They generally require a higher minimum deposit and balance than standard savings accounts. However, they typically offer higher interest rates in return. 

Before proceeding, understand your financial goals and ensure that an MMA fits into your plan. If you have a decent chunk of savings and want a safe place to grow it while maintaining accessibility, a money market account could be a great choice.

STEP 2: UNDERSTAND THE DIFFERENCES BETWEEN BANKS AND CREDIT UNIONS

While banks and credit unions offer similar services, their structures differ. Banks are for-profit institutions owned by shareholders, while credit unions are not-for-profit organizations owned by members. The member-focused approach of a credit union results in better and more personalized customer service.

STEP 3: RESEARCH THE BEST RATES

Choosing the right institution for your high-yield savings is critical and often boils down to banks versus credit unions. While both offer similar financial products, credit unions typically come out on top when it comes to rates. 

As not-for-profit, member-owned cooperatives, they prioritize passing profits to members through higher interest rates. This means you're more likely to find a competitive yield for your savings at a credit union. 

Remember to evaluate not just the interest rate, but the overall package as well, including services, convenience, and membership requirements.

STEP 4: JOIN GHS FEDERAL CREDIT UNION

Contrary to popular belief, credit unions are not hard to join. Becoming a member of the GHS Federal Credit Union (GHS FCU) is very easy. If you live, work, study, volunteer, or attend religious services in Broome, Chenango, or Tioga counties in New York, you're eligible to become a member. If you're related to an existing member who meets these criteria, you can enjoy the benefits of membership too!

You’ll need the following to complete the simple online 3-step application process:

  • A government-issued ID/driver’s license/state ID or passport with your current address

  • Your complete physical and mailing address

  • Your Social Security number

  • Your date of birth

You can also walk into our Binghamton or Norwich branch to talk in person with one of our friendly and helpful representatives. They will guide you through the membership process, answer any questions, and ensure you understand all the benefits and features associated with joining the GHS FCU family. 

STEP 5: DEPOSIT YOUR FUNDS

After your application is approved, you’ll deposit funds into your new MMA. At GHS FCU, you’ll need to maintain a minimum daily average balance of $2,500 for our Money Market Savings account. We also offer an attractive Money Market Plus account that requires a minimum average daily balance of $10,000.00.

STEP 6: WATCH YOUR MONEY GROW

Once you've opened your account and deposited your funds, all that's left is to watch your money grow. Keep an eye on your balance and interest rates, and consider setting up automatic transfers to increase your savings steadily.

OTHER CONSIDERATIONS WHEN OPENING YOUR ACCOUNT

Once you've decided to embark on the journey of establishing an MMA, there are several crucial factors to remember. These additional considerations, including the Annual Percentage Yield (APY), withdrawal options, and potential minimum balance requirements, can impact your overall saving experience and the growth of your investment.

ANNUAL PERCENTAGE YIELD AND DIVIDEND RATES – YOUR KEY TO GROWTH

The annual percentage yield (APY) is the real rate of return earned on a savings deposit or investment, taking into account the effect of compounding interest. In simple terms, it's the magic that makes your invested money grow. Higher APYs yield more earnings. 

The term 'dividend rates' signifies the returns you'll earn on your deposit over a year. These dividends are a share of the credit union's profits distributed back to its members. Therefore, a higher dividend rate means that your savings are not just idle but are actively growing, contributing to enhancing your financial stability.

WITHDRAWAL FLEXIBILITY

While money market accounts offer higher interest rates, it's essential to remember they also come with certain restrictions. To maintain a high-yield account, regulations often limit the number of withdrawals or transactions you can make to six per month. 

Despite this, MMAs usually offer more flexibility than Share Certificates, enabling you to access your funds without penalties if needed.

MINIMUM BALANCE REQUIREMENTS

Credit unions often set a minimum balance requirement for their high-yield savings options. It's crucial to maintain this minimum balance to avoid fees and continue to enjoy the higher interest rate. The specific amount varies by institution, so it's necessary to clarify this before committing to an account.

POTENTIAL FEES

Lastly, pay attention to any potential fees. You might get hit with monthly maintenance fees if your balance falls below the minimum requirement or withdrawal penalties if you exceed the allotted number of transactions. It's important to understand these potential charges as they can adversely impact your earnings.

EMBARK ON YOUR SAVINGS JOURNEY WITH GHS FEDERAL CREDIT UNION

Opening a money market account at GHS FCU can be a wise move for those looking to maximize the growth of their savings. By following the above six steps, you'll be well on your way to expanding your financial portfolio and reaching your savings goals. 

Ready to put your money to work for you? Click below to learn more about the benefits you’ll get from opening a money market account at GHS FCU!

SEE OUR MONEY MARKET ACCOUNT OPTIONS & BENEFITS


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Your savings federally insured to at least $250,000 and backed by the full faith and credit of the United States Government National Credit Union Administration, a US Government Agency.
© GHS Federal Credit Union. All Rights Reserved. Privacy Policy
*APR = Annual Percentage Rate. Rates are shown "as low as". Rates and terms are subject to change. The rate and term may vary depending on each individual's credit history and underwriting factors. Credit Union Membership required with a $1.00 minimum deposit and $1.00 membership fee. Rate shown as low as with discount up to 0.50% for Auto Loans. Rate shown as low as with discount up to 0.25% for Personal Loans and Home Equity Loans.
**APY = Annual Percentage Yield. Rates are subject to change at any time. Early withdrawal penalties may be imposed on Term Share Accounts. Credit Union Membership required with a $1.00 minimum deposit and $1.00 membership fee.
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