How Higher Balances Unlock Higher APY
Tiered money market accounts (MMAs) are a smart way to save because they offer you a variety of high-yield options based on the amount you deposit. The more you deposit, the higher the annual percentage yield (APY). This guide explains how MMA tiers work, what today’s rates mean for savers and simple steps to reach the next tier without losing easy access to your cash.
What Are Tiered MMAs?
An MMA is a savings account that pays dividends based on your balance. With one, you can save money, withdraw it as needed and earn a higher APY than a regular savings account. Some also let you write checks against the account. When compared to other savings products, MMAs can earn you more.
An MMA is a smart alternative if you have a large savings balance and want to earn more in interest. They are usually offered in tiers, with escalating interest rates based on minimum account balances. This means the larger the balance, the higher APY you will receive. The APY tiers and balance requirements will vary by financial institution.
How Do Tiers Raise APY?
The APY is determined by the Federal Reserve’s Federal Funds Rate, which acts as an indicator for what interest rates will be. This includes deposit products, such as savings accounts, MMAs and share certificates or certificates of deposit. Financial institutions will increase or decrease their APY and annual percentage rates based on what the Fed decides.
This fluctuation means that the yields for MMAs may rise or fall. As of Sept. 12, 2025, the top tier of an MMA is about 4.35%, while the national average yield is about 0.52%, according to Forbes.com. Because rates can change at any moment, select an MMA where you can maximize your yield and grow your savings the fastest.
Are MMAs Safe and Insured?
When you open an MMA at a credit union, your funds are federally insured up to $250,000 per deposit account with the National Credit Union Administration. This coverage is like what the FDIC offers with banks. It gives you peace of mind that your savings are protected in case something happens to your financial institution. It also makes it one of the safest ways to save money while earning good interest.
Do Money Market Accounts Have Withdrawal Limits?
Each financial institution has its own requirements for MMAs, even though the functions are quite similar. Some may charge a low balance or maintenance fee if a minimum balance is not kept. Others may not let you accumulate dividends if you don’t maintain a certain balance. There may also be withdrawal restrictions and penalties.
Is an MMA Better Than a High-Yield Savings Account or Certificate Today?
An MMA is an effective savings tool when compared to other options, such as high-yield savings accounts and share certificates. This chart discusses the key differences.
|
Feature
|
MMA
|
High-Yield Savings
Accounts
|
Share
Certificate
|
|
Liquidity
|
High
|
High
|
Low
|
|
Average APY
|
Up to 4.40% APY*
|
Up to 4.35% APY*
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Up to 4.45% APY*
|
|
Best For
|
Short-term
savings
|
Short-term
savings
|
Long-term
savings and to maximize APY
|
|
Key Advantage
|
Combines competitive interest rates with check-writing abilities
|
Competitive interest rates with low fees and minimal requirements
|
Fixed interest rates guaranteeing predictable returns despite market fluctuations
|
|
|
Evaluate your savings goals and select the right account for you. Determine how you will use the account, the period during which you want to save and what financial institution you want to bank with. Remember to shop for the best interest rates, accounts that carry no fees and those with easy requirements.
What Steps Can Help Me Reach a Higher MMA Tier?
If you’re considering saving in a tiered MMA, there are things you can do to reach the higher tiers. First, automate deposits into your MMA to increase your savings each payday. Also, move money from low-rate savings accounts into your MMA to increase its balance and maximize your yield. And make saving a priority by reviewing your budget and identifying ways to limit discretionary spending.
How TCU Can Help
Travis Credit Union offers tiered, high-yield MMAs, such as our Jumbo Plus MMA and Jumpstart MMA. TCU also has certificates where you can lock in a high yield over a specific term. Visit our Money Market Account page to get started. You can open an account online and view our rates at Traviscu.org. You can also schedule an appointment at a branch nearest you.
Travis Credit Union is focused on financial wellness and can show you how to plan, spend, save and borrow better. Our Knowledge Base digital platform offers an array of free online financial education courses on money-related topics that can help you reach all your financial goals.