Types of Savings Accounts

What is a regular/traditional savings account?

• A deposit account that earns interest and allows for regular deposits and withdrawals

• A savings certificate issued by a bank or credit union

• A type of checking/savings account that requires a minimum balance and offers limited check-writing privileges

• A savings option where money is left on deposit for a specific period of time to earn a specific amount of interest

What is the main advantage of a regular/traditional savings account?

• High liquidity

• Relatively high interest rate

• No penalty for early withdrawal

• FDIC insured

What is a certificate of deposit (CD)?

• A deposit account that earns interest and allows for regular deposits and withdrawals

• A savings certificate issued by a bank or credit union

• A type of checking/savings account that requires a minimum balance and offers limited check-writing privileges

• A savings option where money is left on deposit for a specific period of time to earn a specific amount of interest

What is the main advantage of a certificate of deposit (CD)?

• High liquidity

• Relatively high interest rate

• No penalty for early withdrawal

• FDIC insured

What is the main disadvantage of a certificate of deposit (CD)?

• High liquidity

• Relatively high interest rate

• No penalty for early withdrawal

• Not liquid due to set maturity dates

What is a money market deposit account (MMA)?

• A deposit account that earns interest and allows for regular deposits and withdrawals

• A savings certificate issued by a bank or credit union

• A type of checking/savings account that requires a minimum balance and offers limited check-writing privileges

• A savings option where money is left on deposit for a specific period of time to earn a specific amount of interest

What is the main advantage of a money market deposit account (MMA)?

• High liquidity

• Relatively high interest rate

• No penalty for early withdrawal

• FDIC insured

What is the main disadvantage of a money market deposit account (MMA)?

• High liquidity

• Relatively high interest rate

• No penalty for early withdrawal

• Accounts require higher initial deposits and minimum balances to avoid fees

What is the minimum balance requirement for a money market deposit account (MMA)?

• $100

• $500

• $1,000

• $10,000

What is the interest rate range for a regular/traditional savings account?

• Over 1%

• 1%

• Under 1%

• Varies depending on the financial institution