Money Market Rates 101

Finding the best money market rates is getting more difficult as bank interest rates decline nationwide.  I hope that this article helps you to find the best money market rates.

The best money market rates nationwide are currently,

Best Money Market Rates

Darby Direct, Vidalia, Ga. 3.00%
Centennial Bank, Fountain Valley, Calif. 2.28%
GMAC Bank, Midvale, Utah 2.25%
Corus Bank, Chicago 2.19%
iGObanking.com, Lake Success, N.Y. 2.12%

Darby Direct Bank has been having great bank rates for many of its personal banking accounts.  Darby Direct CD rates are very good and it money market rates are the best in the nation at 3%.  If you are looking for the best money market rates, Darby Direct Bank is a great choice.

GMAC Bank also has the best bank interest rates on both its money market account and its GMAC CD rates.  GMAC Bank is trying to encourage more people to open GMAC bank accounts by luring them in with the best bank rates.  This is a great way for you to capitalize on their rates.

For those interested in safe investments, the Vanguard Admiral Treasury Money Market Fund (VUSXX) can’t be overlooked.  We here at Money Market Rates 101 are all about finding the latest and greatest for you, our reader.  The Vanguard Admiral fund is one of the more popular money market funds available.

Currently, this fund is closed, but will likely reopen soon as these funds usually do.  The fund’s administrator (Vanguard) closed the fund to new investors when the markets began to drop earlier in the year.  The Vanguard Admiral Treasury fund seeks to keep a minimum share price of $1 (or 1:1) and invests entirely in short-term government obligations such as Treasury bills.  The minimum investment is fairly high, but the expenses are only 0.15% (as of 12/29/08).

Performance for these low-risk Vanguard Admiral treasury Market Fund investments are about 0.44% (SEC).  Since inception, the Vanguard Admiral Treasury fund has pulled an average of 3.79%.

As of March 9, the fund’s reinvestment limit for current participants will drop to $10,000 per day, which will mean anything more than that to be reinvested will cash out.  Institutional investors in the Vanguard Admiral Treasury Money Market Fund will be locked out on that day as well.  The Vanguard Admiral fund, like all similar funds, are linked to the Federal Reserve’s interest rates, which are extremely low right now, so the yield of the Vanguard Admiral Treasury fund is currently very low.

Of course, like most investment funds, the Vanguard Admiral fund is not FDIC insured and investments are not guaranteed.  The Vanguard Admiral Treasury funds pay dividends monthly.

As we talked about earlier, money market funds are different than money market savings accounts, but so long as we are looking at them, we should definitely look at Fidelity money market funds.  Our goal here at Money Market Rates 101 is to ensure that you have the best information available as quickly as we can get it to you.

Fidelity is a large investment bank that holds a lot of assets and investment funds.  Those who trade with Fidelity will be interested to know what money market funds at Fidelity have to offer.  Three types of Fidelity money market investments are available: standard money market funds, national municipal funds, and state municipal funds.

Some individual state investments can have a slightly higher payoff than others, so investing directly into funds from them can give a higher yield.  Of course, this has a higher research requirement and usually a longer term for maturity, but they can be worthwhile.  For the most part, however, money market funds at Fidelity are in two basic types: taxable and municipal.

Fidelity money market funds in the taxable category are often used to soothe volatile retirement investments or hold money in the short term for instant removal for other investment opportunities.  Fidelity money market investments in this taxable arena are currently producing 0.92% annual percentage yields (APY), but are taxable.

Fidelity money market funds in the municipal funds arena (usually non-taxable) have a lower return rate, but are not taxed.  Currently, money market funds at Fidelity in this municipal fund are paying out 0.14% APY.  Both this and the above example assume $2,500 (minimum) to $5,000 investment.

Investments over $25,000 yield 0.97% in taxables and 0.34% in municipals in those same Fidelity money market funds.

Of course, money market funds are not FDIC insured, as they are investments, but for those who use Fidelity money market funds to hold their cash between investments, they can be a great way to hedge your portfolio.  Of course, rates change daily and the Fidelity money market is no different.

Vanguard money market rates are definitely worth looking into, especially if you’re an investor with Vanguard funds already and need a way to hold your money until the next opportunity comes along.  We at Money Market Rates 101 thought we’d look them over and see what they have to offer right now.

As mentioned in the last post, Vanguard money market accounts aren’t like normal money market savings accounts and are not FDIC insured as they are considered investment accounts.  Be aware of that as you move forward.  That said, however, Vanguard money market rates are very good and are a relatively safe way to store money until it’s reinvested into the market.

Currently, most Vanguard money market funds are invested in Treasuries, US Agency funds, and high quality commercial paper.  They are trading for $1 with a minimum investment of $3,000 and are currently giving a yield of 0.76% (compounded).  This is higher than the typical savings account.

Vanguard rates are variable with the market, of course, but Vanguard money market rates are relatively steady due to their low-risk investment hedges.  Of course, Vanguard money market rates will change over time and quickly, so check the current Vanguard rates before investing.

We definitely think that, for the investor, Vanguard money market funds are definitely worth looking into.

Money market funds are very different from money market savings accounts in many ways and are usually a base investment type for hedging funds until a better opportunity for long term investment comes up.  Since there is a difference, we here at Money Market Rates 101 thought we should go over them for you so you can know your options regarding Vanguard money market funds.

Vanguard is an investment firm that offers money market funds for various uses.  Vanguard money market funds are used for stable interest income, convenient money access (there are no terms with money markets), short-term savings, and of course to park cash while awaiting other investment opportunities with Vanguard funds or any other investment bank.

Several options make Vanguard money market investments even more useful for the investor in Vanguard funds.  Scheduled regular automatic investments can be made from money market at Vanguard into other investments (and back again) to increase the return of the money market funds.  Fast electronic money movement from one Vanguard funds account to another can be made, allowing for quick reactions to investment opportunities.

It’s important to note that the investments that make up the interest rate that money market funds receive are always as stable as possible, which means lower returns than other, riskier investments.  These types of money market funds are also not insurable by the FDIC as they are not bank accounts, but investment accounts.  Vanguard funds are mostly invested in Treasury bonds and other stable assets.

So if you’re an investor, especially with an established firm like Vanguard, then check into money market funds available to you through Vanguard money market and see how they can help you round out your investment portfolio.

Everbank specializes in secure investment-style banking and interest yields. Right now, they’re offering a pledge that money market rates at Everbank will be among the top five in the nation. So obviously we here at Money Market Rates 101 had to give them a look and let you know what those Everbank money market rates are up to.

Currently, Everbank rates for money market accounts have two requirements: either a deposit amount higher than $50,000 for a higher rate and a 3-month bonus rate.

Money market rates at Everbank start at 2.16% annual percentage yield (APY) right now for deposits over the minimum $1,500 to open, but under $50,000. Since these rates are guaranteed to stay in the top five nationally, they will be high for some time, we would think.

For deposits over $50,000 at opening (and held for the first 3 months), a bonus rate of 2.51% APY is paid for three months. That’s a pretty good bonus, we think you’ll agree.

On both Everbank rates money market accounts, there is Internet banking as well as mobile phone access free of charge. Up to six withdrawals or transfers may be conducted per month to hold your money market rates at Everbank and there is no monthly account fee if your balance stays above $1,500.

Everbank money market rates are definitely worth a look and we think you’ll be glad you did. Rates change regularly with the market, of course, so be sure to look at money market rates at Everbank before you open your account. All accounts at Everbank are FDIC insured.

Recently on CSPAN, Rep. Paul Kanjorski (D-PA) discussed the reasons for the bank bailout in September.  The CSPAN video below is amazing.  Representative Kanjorski states that on September 18, 2008 there was widespread panic among money market account holders.  Within hours over $550 billion was withdrawn from moeny market funds across the nation.  While the Federal Government spent over $105 billion to try to stop the run on the money market accounts, it quickly realized that it could not prevent the run.  Therefore, the Federal Government temporarily closed down the money market accounts.

According to Rep. Kanjorski, this would have been “the end of our economic/political system as we know it.”  That is a really bold statement.  Quickly the Federal Government agreed to cover money market accounts under the FDIC insurance program and raised the FDIC limits to $250,000.

You absolutely need to watch this video.  There are many amazing statements made by Rep. Kanjorski.

Bank of America is one of the largest online banks.  Like most banks, Bank of America has a money market account that you should take a look at.  Hopefully, this review of the Bank of America money market savings account.

The Bank of America Balance Rewards money market account provides the flexibility provided by a B of A checking account and the higher interest of a savings account.  BoA has designed its money market savings account to give you higher interest rate savings, quick access to your savings, and an added cash bonus that will helps you build your savings quicker.

One of the best aspects about the Bank of America savings account is its check writing feature.  B of A allows you to write up to three checks per month.  While you can’t use this money market account as your primary checking account, it is nice to know that you can write checks with this account.  While you can only write three checks per monthly billing cycle, Bank f America allows unlimited withdrawals and transfers.

One of the coolest features of the Bank of America account is the Balance Rewards program.  The Balance Rewards program gives you an annual cash bonus at the end of the year.  This bonus payment is calculated by multiplying your lower average monthly balance in your money market account by the bank of america bonus factor.  The current bonus factor is 0.50.

The Bank of America money market rates are not the best money market rates, but they are worth considering.  Bank of America provides a lot of other nice features that make their interest rates acceptable.

I hope that you have enjoyed this Bank of America money market savings account review.  If you have any questions not answered in this review, please ask a question in the comments.  Additionally, we would love to hear your review of the Bank of America money market account or the Balance rewards program.

The VirtualBank eMoney Market Account is one of the most popular banking products available at VirtualBank.  Here at money market rates 101 we try to bring you the latest information on the best money market rates.  Consistent with this goal, we bring you this review of the VirtualBank eMoney Market Account.

This VirtualBank money market account starts with an interest rate of 2.50% and an APY of 2.53%.  You can qualify for this 2.50% money market rate by opening a Virtual Bank money market account with as little as $100.  This $100 minimum balance is a very low amount that should allow anyone to open a money market account.

This VirtualBank account has no monthly fees and is FDIC insured.  With today’s uncertainty in the financial markets, opening a money market account that is FDIC insured is very important.  Unlike money market funds, money market accounts add extra protection for your money.  If the fianancial institution fails, your money is protected by FDIC insurance.

The VirtualBank money market rates go up to 3.75% if you invest over $100,000 in the VirtualBank account.  While many do not have $100,000 to invest, if you do, this 3.75% interest rate is one of the best money market rates. You should check out the VirtualBank money market account.

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If you are looking for the best money market rates, the Union Federal Savings Bank money market account is offering some of the highest interest rates on money market accounts in the country.  The Union Federal Savings bank money market account is currently paying 3.75% interest rates with only a $1 minimum balance requirement.

For only have a minimum balanace requirement of $1, it is hard to beat the Union Federal money market account.  These Union Federal accounts are FDIC insured and they boast that they do not charge any hidden fees.  These specs might qualify this as the best money market rates we have found today.

Union Federal was established in 2001 in in North Providence, Rhode Island. It is dedicated to providing its customers with the highest interest rates for people trying to save money and competitive loan rates for borrowers.  While you might not have heard of the Union Federal Savings Bank money market account, you should check it out.