You can withdraw money from a typical savings account, but there are limits to how frequently you can do so. In most cases, you are limited to six withdrawals per month from a savings account. However, limits on savings accounts vary by financial institution, so check with your bank or credit union to find out what savings account withdrawal limits they have in place.
You probably have a savings account that you’ve been using to save money for a while. For the most part, you leave it alone to earn interest and use your checking account for everyday expenses. But what if you suddenly need to access funds in your savings account? Maybe an emergency expense has come up or you’re finding it difficult to afford normal purchases on a day-to-day basis, so you decide to make a few savings account withdrawals to temporarily tide over your finances.
Now comes the question: Can you even take out money from a savings account, and how much money can you take?
Checking and savings accounts don’t work the same; unlike a checking account you would use for everyday banking, there are usually withdrawal limits on savings accounts. Let’s take a closer look at how savings accounts work and how withdrawal limits can affect you.
Can you take out money from savings account funds?
The good news is that in most cases, banks and credit unions will allow you to withdraw funds from a standard savings account without incurring a penalty. So if you are in dire need of extra cash, you should be able to access your savings without a problem.
However, there are a few exceptions you should be aware of. As mentioned above, savings accounts are different from checking accounts, so there are limits to withdrawing and spending money in a savings account that you should keep in mind.
What to know about the savings account withdrawal limit
Checking and savings accounts have a few things in common: they are widely available at both brick-and-mortar banks and online banks, they are both insured by the Federal Deposit Insurance Corporation (FDIC), and they both allow you to withdraw money. That said, there is a limit to how often you can withdraw money from a savings account.
In the past, the Federal Reserve Board Regulation D has required that financial institutions meet specific conditions for savings accounts and money market accounts, including limiting accounts to six withdrawals per month. This limit was suspended in 2020 in response to the COVID-19 pandemic, but many financial institutions continue to impose this six-transaction limit on their savings accounts.
Because every financial institution has its own rules, you should check with your bank or credit union for the limits on your savings account.
Can you spend money directly from a savings account?
Generally speaking, you cannot spend money directly from a savings account. If you want to spend money from a savings account, you will need to take one of the following steps:
- Transfer money to your checking account. If you have a checking account at the same bank as your savings account, you can instantly transfer funds between them. If your checking account is at a different bank, you can still transfer money to it from your savings account, but it will probably take a few business days to arrive.
- Withdraw cash from an ATM. While you can only get a debit card for a checking account, some savings accounts come with an ATM card that will allow you to withdraw cash from your savings at an ATM within your bank’s network.
- Call your bank and request a transfer or check. The convenience of online banking has made this old-fashioned option largely obsolete, but you may still be able to contact your bank for help with transferring funds between accounts.
What happens if you withdraw from a savings account too frequently?
While most savings accounts and money market accounts still impose a limit of six withdrawals a month, you may find yourself in a situation where you need to withdraw from your savings more frequently. So what happens if you surpass your account’s monthly withdrawal limit?
In most cases, you can continue to withdraw money from your savings account beyond the six-transaction limit, but every subsequent transaction will incur a withdrawal limit fee. This can quickly eat into your funds if you’re not careful, so if you need to withdraw from your savings more often, you should try to find a savings account that will charge fewer fees.
Less obviously, frequently withdrawing from your savings balance will stunt its growth. Savings accounts have higher interest rates than checking accounts so an account owner can accumulate funds and leave them to grow over time. If you withdraw from your savings frequently, you should make sure to replenish your savings balance as much as possible with an automatic savings plan.
Can you withdraw money from your savings account at an ATM?
Yes, if you have an ATM card that allows you to withdraw from your savings. When withdrawing money from an ATM, select the option for Savings Account.
What kind of savings accounts are affected by Regulation D?
Regulation D affects standard savings accounts, high-yield savings accounts, specialized savings accounts, and money market accounts. It does not apply to checking accounts. However, since 2020 the six-transactions limit no longer applies to savings accounts.
How much money can I withdraw from my savings account in one day?
There is no monetary limit on how much you can withdraw from a savings account. However, many banks limit you to six withdrawal transactions from your savings account per month.
Do you have to pay a fee to deposit funds into a savings account?
No, you do not need to pay a fee to deposit money into a savings account.
- According to Federal Reserve Board Regulation D, savings accounts in U.S. financial institutions have a limit of six withdrawals per month.
- As of 2020, the six-transaction limit has been removed in response to the COVID-19 pandemic, but many banks and credit unions still impose this limit on their savings accounts.
- In general, it is not possible to spend money directly from a savings account. Instead, you can transfer money from a savings balance to a checking account or withdraw funds from an ATM using an ATM card.
- Excessive withdrawals from a savings account may incur a withdrawal limit fee for every transaction over the monthly limit.
- There is no federal monetary limit to how much money you can withdraw from a savings account at a time.
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View Article Sources
- Regulation D, Reserve Requirements – Federal Reserve Board
- Federal Reserve Board announces interim final rule to delete the six-per-month limit on convenient transfers from the “savings deposit” definition in Regulation D – Federal Reserve Board
- FDIC: Deposit Insurance At A Glance – Federal Deposit Insurance Corporation