Which type of account typically requires a higher minimum balance?

A money market account typically requires a higher minimum balance compared to other types of accounts. This is primarily because money market accounts often offer higher interest rates than basic checking or regular checking accounts and sometimes even savings accounts. The financial institutions that offer these accounts have certain criteria, like maintaining a higher minimum balance, to ensure they can manage funds effectively and provide competitive interest rates.

Additionally, money market accounts may come with features like limited check-writing privileges and debit card access, making them more akin to a hybrid between a savings account and a checking account. The higher minimum balance requirement helps the institution maintain liquidity while providing a higher yield to the account holder. In contrast, basic and regular checking accounts usually serve everyday transaction needs and are designed to be more accessible, thus typically having lower minimum balance requirements.