How to Invest in Money Market Funds

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Money market funds are not commonly seen as an investment, but rather as more of a savings vehicle to put away money that's liquid. Find out if money market funds have checking options with help from a portfolio manager in this free video on personal finance and money management.

Part of the Video Series: Stocks & Bonds
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Video Transcript

O.k, so you're wondering how we invest in money market funds. Money market funds, you know, are commonly not seen as an investment. It's really more of a savings vehicle, and money market accounts at your local bank or even at a brokerage house, are really a ways to put away money that's liquid, that you can access. You don't have limitations, you want to be able to use a money market account that you would use, just as you would use either a savings or a checking account. Some money market accounts do have checking options available to them, it's very common in the brokerage industry. At banks, money market accounts are just sort of a high yield savings account, and the reason it's higher yielding is a little different bit of investing, rather than a regular savings account on the underlying securities that create that interest rate. Also, they're asking for larger sums of money, so when you invest in a money market account, many times they'll ask for twenty five hundred dollar, five thousand dollar minimum and for the different levels that you put into the money market account, you will get a higher or lower interest rate, just depending on how much you put in. But, their a great liquid vehicle, there's really very little, or very few or no restrictions on them, they may just require a minimum balance. But, that really is the basics on a money market account.


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