A passbook savings account is a rudimentary method, but it's tried and true. Yes, you should have a savings account. A passbook savings account is not an investment plan. The rate at which your money will grow is far below what you might earn from other types of investments. More Money, Maybe Money market funds are one step beyond the savings account for committed savers.
Money markets offer the highest rate of interest to the saver, without making any time requirement.
The name money market is very descriptive. There is, indeed, a market place where businesses, banks, government entities, and other people shop for cash to use for their specific needs. You can lend your money to these people by using a money market fund. The fund invests in commercial paper, banker acceptances, repurchase agreements, government securities, certificates of deposit, and other highly liquid and safe securities and pays the interest averaged from this collection of investments. Money market funds were launched in the mid-1970s and were especially popular in the early 1980s when interest rates and inflation soared.