How does the money market work?

How does the money market work?
A money market account is very similar in nature to a savings account with the most significant difference being that you often have the ability to write checks from it. Most broker/dealers and mutual fund companies offer money market accounts in some form.

For small balances, a savings account is often more beneficial as some money market accounts can charge substantial fees unless a minimum balance is maintained. Some banks also impose restrictions on the number of withdrawals that are allowed.

Money market funds are stable funds, where if you deposit $1 you will get $1 back - this is known as the "Net Asset Value" (NAV) of the fund.

Be sure before you invest in any money market fund whether it is with your local bank or a broker/dealer or mutual fund that you thoroughly investigate fees, earnings, and whether or not the funds are insured.