The Federal Reserve Board Announces Lift on Saving Withdrawal Limits

Many people keep a savings account to manage their finances. Generally speaking, banks in the United States only allowed a limit of six transfers or withdrawals per month from a savings account. Once the limit was reached, individuals could only access their funds through ATM or branch visits. However, the Federal Reserve Board announced an interim rule that they are lifting this limit and banks can now allow saving account holders to make an unlimited number of transfers or withdrawals. This decision was made as a result of the Coronavirus pandemic causing economic uncertainty and unemployment for many people across the nation. 

In addition to this decision, the Fed stated that banks are no longer required to keep a regulatory distinction between checking and savings accounts. It is important to know that it does not prohibit banks from charging their customers certain fees for transfers or withdrawals that are over the six transfer limit. The Fed stated, “The amendments are intended to allow depository institution customers more convenient access to their funds and to simplify account administration for depository institutions.”

Account holders should check with their banking institutions to see how the interim rule will be implemented for them. However, greater access to these finances could help people who are struggling to cover some expenses during this time. Those who are experiencing financial hardship can go into their savings for some assistance instead of feeling tempted to reach into any retirement accounts they may have. This is important for communities during this time as they are dealing with the impacts of the Coronavirus outbreak. 

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