![]() Which transactions don’t apply to the savings account withdrawal limit? Overdraft transfers from your savings account to your checking account.Automatic or preauthorized transfers, such as bill payments or any other recurring transfers.Online transfers from those accounts to a different account either at the same institution or a different one. ![]() These kinds of transactions in savings or money market accounts fall under the rule: Which transactions are limited under Reg D? The law doesn’t apply to checking accounts, so they do not have the same withdrawals restrictions. If you go over the limit, the bank or credit union can charge you a fee, close your account or convert it into a checking account. Regulation D is the federal government’s way of ensuring that financial institutions have the proper amount of reserves on hand and encouraging people to use savings accounts as they are intended: to save money. The federal rule, also known as Reg D, comes from the Federal Reserve Board and puts a limit of six transactions per month on certain transfers and withdrawals from your savings or money market account. Savings accounts are an easy place to stash your cash, but a federal rule called Regulation D puts limits on some withdrawals. Using an ATM or teller helps skirt the limit. Ally had already announced the waiver of that fee (not clear how they were allowed to do so legally), and I’d expect to see others make that temporary policy now as well.NEW Savings Account Withdrawal Limits Federal law limits you to six monthly savings transfers or withdrawals. The rule allows financial institutions to make that change, but ultimately your bank will have to allow it in order for you not to get hit with a over-the-limit penalty. The regulatory limit in Regulation D was the basis for distinguishing between reservable “transaction accounts” and non-reservable “savings deposits.” The Board’s recent action reducing all reserve requirement ratios to zero has rendered this regulatory distinction unnecessary.Ĭoncurrently, the Federal Reserve is making temporary revisions to the FR 2900 series, FR Y-9, and FR 2886b reports to reflect the amendments to Regulation D. The interim final rule allows depository institutions immediately to suspend enforcement of the six transfer limit and to allow their customers to make an unlimited number of convenient transfers and withdrawals from their savings deposits at a time when financial events associated with the coronavirus pandemic have made such access more urgent. The Federal Reserve Board on Friday announced an interim final rule to amend Regulation D (Reserve Requirements of Depository Institutions) to delete the six-per-month limit on convenient transfers from the “savings deposit” definition. The Federal Reserve Board on Friday announced an interim rule to delete the requirement of the six-per-month limit on transfers from savings accounts. Thus far, almost no banks have done away with the limit in a permanent form (only temporarily). Once again, this rule allows banks to hav no withdrawal limits ultimately it’s up to each bank whether to have a limit and/or a fine for exceeding the limit. This would be a great, consumer-friendly change if it gets adapted by the banks for the long haul. ![]() The initial message from the Federal Reserve on 4/24/20 stated this is an ‘interim’ rule, but they released follow-up guidance (apparently on 5/13/20) that they have no plans on re-imposing the rule. ( link)Īccording to guidance from the Federal Reserve this change is permanent the fed has no plans of bringing back the six-per-month rule in the future. Update 6/29/20: Marcus is the first major bank to fully eliminate the 6-withdrawal limit. Update 3/4/21: Citi is now showing on their website, “Beginning April 19, 2021, Citi is lifting the six-per-statement limit on transfers from your savings and money market accounts.” Hat tip to reader SamL Update 4/27/21: By now, some banks still have the 6-withdrawal limit while others have removed it or have created other limits. ![]()
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