Savings accounts typically offer more interest than which type of account?

• A. Checking accounts
• B. Retirement accounts
• C. Money market accounts
• D. Certificate of deposit (CD) accounts

Answer: (A)

Verified step by step guidance

1. Understand the context of the question: Savings accounts are a type of deposit account offered by banks and financial institutions that typically provide interest on the balance held in the account.
2. Compare the features of savings accounts with checking accounts: Checking accounts are primarily designed for frequent transactions and typically offer little to no interest. Savings accounts generally provide higher interest rates than checking accounts.
3. Analyze retirement accounts: Retirement accounts, such as IRAs or 401(k)s, are designed for long-term savings and investment, often offering higher returns than savings accounts due to investment options. Savings accounts usually do not offer more interest than retirement accounts.
4. Evaluate money market accounts: Money market accounts are similar to savings accounts but often provide higher interest rates and may have higher minimum balance requirements. Savings accounts typically offer less interest than money market accounts.
5. Consider certificate of deposit (CD) accounts: CDs are time deposit accounts that lock in funds for a specific period in exchange for higher interest rates. Savings accounts generally offer lower interest rates compared to CDs.