red colored pencil

What are the Differences Between a Money Market Account and a CD?


Adequate savings are critical to healthy finances. Instead of keeping money in a piggy bank or regular checking account, you may be curious about money market and CD accounts. Let’s take a look at what each has to offer and how they differ. And if you have questions, we have real people ready to help at 888.827.5564.

What is a money market account?

In simple terms, think of a money market account (MMA) as a type of savings account. You earn interest on it according to current money market interest rates. The interest rates on MMAs are often better than with regular interest-bearing checking or savings accounts.

Note that there is typically a higher balance requirement to open and maintain an MMA than with a traditional savings account. There could also be a monthly maintenance fee.

What is a CD?

CD stands for Certificate of Deposit—a time deposit account with a fixed interest rate and a fixed date of withdrawal. When you open a CD, you agree to leave your money in the bank for a set length of time (known as a term). The interest it collects is called the Annual Percentage Yield (APY). Our bank offers a wide range of fixed terms—from 30 days all the way up to 5 years or more. Just like with the money market account, there is a minimum amount required to open a CD, with higher dollar amounts typically earning higher interest rates.

Accessibility is key

MMAs and CDs have similarities: They are both very safe—federally insured by the FDIC for up to $250,000. They both require minimum balances to open. Both earn interest.

The main difference between the two is the accessibility of funds. Money market accounts allow you to withdraw funds when needed, but by law you are limited to only 6 transfers or withdrawals per month or statement cycle. On the other hand, CDs completely restrict access to the money. Your funds must remain in the account until the CD matures. If an event occurs where you make a necessary decision to withdraw the funds before the maturity date, you can, but you will be charged a penalty for early withdrawal.

MMAs and CDs are just a couple of the ways we’re working to Create Possibility. Compare rates on our money market and CD accounts, then think about how much access you might need to your funds. Our friendly personal bankers at Sunflower Bank and First National 1870 would love to show you options for these and other accounts that meet your individual needs. From time to time we often may run a special rate for MMAs or CDs. Make sure to ask your banker about our current offers. Visit a location today.

Banking Education

Ready to explore how First National 1870 can assist you? Speak to a personal banker at a branch near you, contact a specialist on our Wealth Management team, or find the right financial partner on our Commercial Banking team for your business needs. 

Back to Resource Articles

This article contains general information only. First National 1870 is not, by means of this article, rendering accounting, financial, investment, legal, tax, or other professional advice or services. This article is not a substitute for such professional advice or services, before making any decisions related to these matters, you should consult a qualified professional advisor..