Like fixed-income investments, money market investments pay a defined
income over a set term. (The income may be fixed or variable.) The advantage
of money market investments is that the U.S. government backs many of
them or the Federal Deposit Insurance Corporation (FDIC) insures them,
so return of your principal is practically guaranteed. This makes money
market investments an attractive choice for investors with short-term
goals. The major disadvantage of this investment class is that the investments
historically have not produced returns much greater than the inflation
rate.
