Even with electronic transfers and ATMs and all the other advances in communication and technology, sometimes, when you deposit your paycheck, you still have to wait a day or two to spend that money. You can get same-day delivery from Amazon in some places, but you have to wait on a check to clear. When that wait happens...those aren't same-day funds.
Same-day funds are, as you might guess, funds you can use that same day. Once you deposit them, you can transfer the money or take cash out of the bank immediately. There's no lag in the settlement of the checks.
Usually, this isn't the case. However, banks do have exceptions, i.e. times when they allow same-day funds. For instance, some banks allow same-day funds for paychecks from major payroll processing companies (although...most paychecks are processed via direct deposit, anyway). Meanwhile, banks also sometimes allow same-day funds for checks issued by that same bank; that is, by the same bank where you're depositing. Since they're only transferring funds from one of their accounts to another, they allow the same-day option. (It's all the same cash in the back; they just move it to a different pile. That's how banking works, right?)
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Finance: What is a Money Market Fund?80 Views
finance a la shmoop. what is a money market fund? isn't it a strange concept
to think about going to a market to buy money? [man walks through grocery store]
well yeah it's strange but the practice exists and it's a huge multi trillion
dollar market today. the key word here is money and not investment. why such a big
diff? well because the notion of investing implies duration. that is when
you invest in a nice fixer-upper home or a tractor distribution company or shares
in a fat dividend-paying bank you're investing for presumably a long time [people stand in line]
like years maybe decades maybe centuries if you can find the right miracle pill.
but here we're talking about money like the stuff you can buy candy with. so it's
short term not long and a money market fund basically comprises many series of
pretty safe bonds that are all coming due in the next 30 to 90 days. sometimes [pie chart]
longer than that sometimes shorter but generally in the very near future. so why
would you care about a money market fund? well because it pays you slightly more
interest on your money than say a bank checking account. and lots of people in
corporations need cash just sitting around to pay their bills, so there are
tons of money market funds out there available and that's the gist of a money
market fund. we're sure you'll have plenty of experience with them by the
time you hit your sixth hundredth birthday day [people cheer and hold birthday cake]