Can Money Market Account be used as Checking Account?

Question

You know how we use debit card and money is directly coming out of Checking account? Also we write personal checks, and the money is coming directly out of checking account.


I was wondering if I can do the same for the Money Market account. I was wondering if I can use another debit card and make the money come directly out of my money market account. I was also wondering if I can write different personal checks and make the money come directly out of Money Market Account.

Why would I want to do this? because Money Market gives us more interest rate, so I want to just have Money Market account and take care of all the above businesses. I don't want to have a checking account if I can do all those things (debit card, personal checks) with Money Market Account.
Thank you so much.

Answer 1

There is a banking rule in the U.S. that you are only allowed 6 withdraws from a money market account, and usually only 3 of them can be by check, the other 3 must be done in person (via teller of ATM) or ACH withdraw. After that, you are assessed penalties, sometimes as much as $15 per withdraw over 6. Money market accounts also rarely, if ever, offer debit cards to withdraw at stores, though you can access through an ATM.

Answer 2

Many financial institutions place limits on how you can access your Money Market account. I checked Vanguard.com and theirs allows unlimited withdrawals of over $250 each, though you might want to note that a withdrawal is actually a stock redemption that could trigger taxable income events.

If your MMA is from a bank/credit union, they'll probably put a minimum balance limit, as well as a max withdrawal/month limit.

So if your plan is to use your MMA like a checking account, why not open both? Keep just enough money in your checking account to cover your living expenses, and sweep the excess into a MMA until you decide where to move that money into more aggressive investments.

Looking for a checking account that earns interest is probably not worth it because of the piddly rates they offer, which get eaten up by income taxes anyway. But definitely find one that doesn't charge you to keep an account open, which probably means setting up a direct deposit and using their online bill payment system.

Answer 3

It really depends on your bank. The bank I work for, you can't. You can write checks off of your money market account. They will provide you with starter checks until you get your official checks. You cannot however, link your personal checking account to your money market account.
Hope this was helpful.

Answer 4

I believe that if you use a money account such as a good mutual account you need to have made a purchase about $250 or something like that. It has to be a major purchase not just to fill up your car (but lately maybe that could be a major purchase lol). You need to talk to someone in finances to really find out.

Answer 5

MMAs have strict limits on the number of withdrawals you can make a month (3-5 a month) You can have a checking account and have the overdraft protection on the MMA.

Answer 6

Yes most mm issue cards and checks just like regular ck.ing. You may be limited to # transactions Most mm are similar but different have to ck. with the bank or go to bankrate.com and click around.