One of the important things to consider is how often the interest compounds. This means that some interest for some kind of investment vehicles compounds every day while others compound every month or quarter. Daily compounding interest is by far the best kind as it will be added to your initial deposit every day and every day the amount you will be earning interest on will be greater.

Any investment that gives you compounding interest grows much faster than one that doesn’t assuming they both give you the same rate. On the surface this difference may not seem like a lot but if you calculate the math over a long period of time, the amount you will earn with compounding interest will be significantly greater.

Another advantage of most money market accounts is that the more money you have in one, the higher interest rate it will earn. This does not typically happen with savings account or other types of account that you will find with at your bank or stock broker. Money market interest rates may be low right now but the fact that they give you compounding interest and higher rates with higher balances help offset the low rates.

As always please consult and ask questions wherever you are thinking about investing money. No two banks have the exact same policies and they all have different interest rates and conditions. Not all money market accounts pay compound interest so please specifically ask about that before you decide to invest.