News & Advice

There are many ways to invest and save your money, so weighing your options and considering what will best meet your financial goals is a smart move.

A money market account, share certificate, and individual retirement account can each help you earn more money and set yourself up for a healthy financial future. While saving money is always a good thing, make sure you’re getting the most out of your savings by picking the option that’s best for you.

What is a money market account?

When you open a money market account, you can earn interest on your balance based on current interest rates. With a money market account, you can often get higher interest rates than typical savings accounts.

What sets money market accounts apart is that they often come with a debit card and checks, which are usually only available with a checking account. Think of it like a hybrid between a checking and savings account. 

INOVA money market accounts are federally insured to at least $250,000 by the National Credit Union Administration.

What is a Share Certificate?

A share certificate (typically called "certificate of deposit" at banks) is similar to a savings account but with a fixed duration. Share certificates allow you to earn interest on your money over that specified time. Since you’re committing to locking your money for a specific amount of time, share certificates offer higher interest rates so you can earn money on what you deposited.

They’re low risk and often considered useful for saving for specific goals, like if you know you’ll want to upgrade your car in five years, for example. Share certificates aren’t where you want to put your emergency funds, since if you take the money out before the fixed term is up, you’ll get charged a penalty fee.

What is an IRA?

With an individual retirement account, your money can grow tax-deferred or tax-free, depending on what type of account you have. Unlike a 401(k), an IRA isn’t managed by your employer. 

Consider your age, income, and financial goals when choosing a traditional or roth IRA. 

If you’re 50 or older in 2023, your annual catch-up contribution can now be up to $7,500, up from $6,500 in 2022, due to the SECURE Act. 

What’s best for me? 

When deciding between a money market account, CD, or IRA, consider what you’re saving for and what your long-term financial goals are. 

If you want the ability to add and withdraw money regularly, a money market account is best for you compared to a CD. While CDs typically offer a higher yield than money market account, they do require you to leave your money untouched for a certain amount of time. An MMA would be a better place to store emergency savings, for example, since you can access them easier and without penalty. 

If you want a low-risk way to save money, a CD is a great option. If you’re more interested in long-term savings for retirement, an IRA is going to earn you more money over time and offers you more tax benefits. 

Whether you want to save with a CD, money market account, or IRA, at INOVA Federal, we’re always within reach to help you accomplish your goals. Stop in and see us at one of our convenient locations, or visit us online to learn more about how to save for a successful future.