Can you take money out of a savings account? Pros, cons, and ways to withdraw (2024)

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• You can take money out of a savings account if you need it to cover an expense.
• Some financial institutions only permit six free withdrawals per month.
• If you make frequent withdrawals from a savings account, it may affect how much interest you'll earn.

Savings accounts are ideal places to store money you don't want to touch, while checking accounts are better for managing your expenses. That said, if you need to withdraw money from your savings, it's possible. You don't want to get charged an excess withdrawal fee, though.

Here's what you need to know about withdrawing money from a savings account so you can avoid fees.

Can you take money out of a savings account?

You can take money out of a regular savings account at any time. However, some financial institutions have free withdrawal limitations.

Savings accounts may have monthly transaction limits per federal rule Regulation D, which stated that banks must penalize consumers for withdrawing from savings more than six times per month. The Board of Governors of the Federal Reserve amended Regulation D during the COVID-19 pandemic. Banks have the option to enforce a six-per-month transaction limit, increase the withdrawal limit, or delete the limit so customers can make unlimited transfers and withdrawals from their savings accounts.

Why do some financial institutions impose a monthly transaction limit? They want to encourage customers to grow their money in savings accounts and manage expenses through a checking account. Checking accounts do not have monthly withdrawal limits, regardless of where you bank. It also benefits banks to have a monthly transaction limit on savings so they can maintain cash reserves.

How withdrawals affect money in savings accounts

If you frequently withdraw money from a savings account, it could impact your savings.

For instance, some financial institutions will charge a fee for withdrawals that surpass their six-per-month withdrawal limit. This common bank fee is referred to as an excess transaction fee. It can cost up to $10 per transaction.

Frequent withdrawals also affect the amount of interest you can earn on a savings account.

Sarah Wicker, manager for deposit account and IRA services at Georgia's Own Credit Union, says the interest you'll earn on an account is determined by your account balance. If your savings account is being used for transactions, your balance will become lower. As a result, you may not earn as much interest. If you have a tiered interest savings account, you could also drop to a tier that has a lower annual percentage yield (APY).

Ways to withdraw money from a savings account

If you need to take out money from your savings account, here are three convenient ways to make a withdrawal:

• Withdraw money at an ATM: You can usually withdraw money from your savings account at an ATM. All you'll have to do is use an ATM card or debit card, and select that you want to take out money from a savings account. Bear in mind that financial institutions have daily ATM withdrawal limits. That means you can only take out a certain amount of money from an ATM per day. If you use an out-of-network ATM, the ATM issuer and/or the financial institution may charge you a fee.
• Visit a branch:If you bank with a brick-and-mortar financial institution, you could visit a branch to take out money from your savings account. You'll go to a teller, provide your account information, and tell them you want to take out money from your savings account.
• Transfer money to a checking account:If you use online banking, you can transfer money to your checking account. That way, you can use your account's debit card to access to your money. Similar to ATM cards, debit cards also have daily maximum limits. You can only spend a certain amount from your debit card per day.

Savings account withdrawals FAQS