Federal Reserve rate cuts in 2024 lead to falling money market account rates
From Yahoo Finance: 2025-05-04 06:00:00
The Federal Reserve has cut its target rate three times in 2024, causing deposit rates, including money market account rates, to fall. It is crucial to compare MMA rates to maximize earnings. The national average money market account rate is 0.63%, but some top accounts offer rates of 4% APY. Consider opening an account now to take advantage of high rates.
Earnings from a money market account depend on the annual percentage rate (APY) and how often interest compounds. For example, a $1,000 deposit at 0.64% interest with daily compounding would grow to $1,006.42 after one year. Choosing a 4% APY account would yield $1,040.81 after one year, including $40.81 in interest. Depositing more money leads to higher earnings, with a $10,000 deposit at 4% APY resulting in $10,408.08 after one year.
Read more at Yahoo Finance: Best money market account rates today, May 4, 2025 (best account provides 4.41% APY)