Prior to April 24, 2020, money market accounts typically had a limit of six withdrawals per statement cycle. However, the Federal Reserve eliminated this rule on that date, thereby removing the limitation on certain withdrawals and transfers.
Even after three years, many money market accounts still limit the number of certain withdrawals and deposits you can make in a statement cycle. However, withdrawals made through ATMs and with the help of a teller usually have no such limits, as has been the case historically and continues to be so today.
Since the Federal Reserve has lifted the rule on withdrawal limits for money market accounts, it is important to note that most banks still maintain this limit.
Money market accounts aren’t meant for frequent withdrawals
Money market accounts are a type of savings deposit account that allow for a limited number of transactions. They provide more access to funds compared to most savings accounts, such as check-writing privileges or a debit card.
Money market accounts and savings accounts are typically used for money that is not frequently required. However, if you do need to access your money, there is usually no penalty, unlike with a CD.
There is only one exception to the rule mentioned above. The exception applies when a bank imposes a fee for making too many withdrawals that exceed the set limit in a certain period. KeyBank is an example of such a bank, which allows up to seven withdrawals of a specific type per monthly statement period. However, if a customer makes more than seven withdrawals, KeyBank imposes a $15 fee for each extra withdrawal or transfer.
Banks may limit your money market withdrawals
According to a recent survey, many banks are still placing restrictions on the number of withdrawals and transfers allowed on money market and savings accounts. It should be noted that banks are no longer required to do so as they were prior to spring 2020.
Regions Bank has stated on their website that the dollar amount and number of external transfers may differ. Thus, it is recommended to check the limits for online banking. Additionally, one should take note of the withdrawal limits and the number of times they can withdraw or transfer money from a money market account at their bank.
There may be limits on how much you can withdraw within a certain timeframe, even if you use Zelle or other withdrawal methods.
Savings deposit accounts, such as money market accounts and savings accounts, typically restrict the number of certain types of withdrawals and outgoing transfers that can be made per statement cycle. Additionally, there may be limitations on the dollar amount of transfers made through Zelle or other methods.
Before opening a money market account, it’s crucial to understand the withdrawal limits to make sure you can access your funds during emergencies and avoid any issues. Money market accounts can be valuable as long as you know their withdrawal limitations.