Advantages

• Government-insured type of money market deposit account.

• A type of high-interest NOW account.

• Offers limited check writing.

• Money can be withdrawn by check, ATM, or electronic transfer at any time without penalty.

Disadvantages

• Requires a high minimum balance

Because many NOW accounts charge higher fees, you may not be ahead in using this kind of account. Depending upon the fee structure and the way your daily balance changes, you might be better off working with a bank that will transfer funds from a savings account to your checking account when needed. A share draft account is a credit union version of a NOW account and usually carries lower fees than banks and savings and loans.