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There was a time when all money market accounts had withdrawal limits — generally six but sometimes fewer per statement cycle. That all changed on April 24, 2020, when the Federal Reserve deleted its rule limiting certain withdrawals and transfers to six per monthly statement cycle.
More than three years later, most money market accounts still restrict the number of certain types of withdrawals and deposits you can make during a monthly statement cycle. ATM withdrawals and withdrawals with a teller have historically been and remain today mostly unlimited.
Here’s what you should know about money market accounts since the rule on withdrawal limits has been lifted by the Federal Reserve but continues to exist at most banks.
Money market accounts aren’t meant for frequent withdrawals
Money market accounts, which are a type of savings deposit account, are meant for a limited number of transactions. Money market accounts can offer more options to access funds than most savings accounts do, such as check-writing privileges or a debit card.
The exception to this is if a bank charges a fee for excessive withdrawals for exceeding the bank’s limit during a certain period. For instance, KeyBank allows seven withdrawals of a certain type per monthly statement period, but it charges a $15 fee for each of those withdrawals or transfers after seven.
Banks may limit your money market withdrawals
A recent Bankrate survey of banks found that most are still limiting the number of certain withdrawals and transfers on money market accounts and savings accounts. Banks just aren’t required to like they were before the spring of 2020.
For instance, Regions Bank says on its website that external transfer dollar amount and number of transfers may vary. So at this bank, you’ll need to check your limits for online banking. Make note of the withdrawal limit amounts at your bank, as well as the number of times you can withdraw or transfer money from a money market account.
Zelle and other withdrawal methods may also have restrictions on the amount you can withdraw during a certain period.
Most money market accounts and savings accounts (both are savings deposit accounts) limit the number of certain types of withdrawals and outgoing transfers you can make per statement cycle. The dollar amount of these transfers might also be limited through Zelle or other methods.
These accounts can be of great value, but it’s important to learn what the withdrawal limits are before deciding whether to get a money market account. That way you can ensure that you won’t run into any issues if you have an emergency or need to make a withdrawal.