Excess Withdrawal Fee Comparison at Top 10 U.S. Banks

Apr 19, 2017 | 2 Comments

ATM machines at TD Bank
ATM machines at TD Bank

Savings accounts differ from checking accounts in several ways. Besides being able to earn interest, savings accounts can also charge an excess withdrawal fee -- a fee nonexistent in the realm of checking accounts. Designed to keep money in the bank to build interest, savings accounts are a great place to park your money. But constant withdrawals from a savings fund should be avoided, as that will not only hamper your ability to save, but you will also incur an annoying fee. Compare the excess withdrawal fees at the top 10 banks in America.

Excess withdrawal fee

Regulation D limits certain types of withdrawals and transfers from savings or money market accounts to a total of six per monthly statement period. Banks will generally not charge a fee until you exceed this limit, but some may start charging a small fee after the second or third withdrawal from a savings account.

Remember that the first six withdrawals are legal transactions. Past the sixth withdrawal, you will usually be charged larger fees.

Excess withdrawal fees at the top banks

Bank Excess Withdrawal Terms
Bank of America $3 after the 3 allowed
Wells Fargo $15 after the 6 allowed
Chase $5 after the 6 allowed (max. of 3)
Citibank Does not charge
U.S. Bank $25 after the 6 allowed
PNC Bank $3 after the 3 allowed
Capital One $10 after the 6 allowed
TD Bank $9 after the 6 allowed
BB&T $15 after the 6 allowed
SunTrust $4 after the 2 allowed
Ally Bank $10 after the 6 allowed
Capital One 360 Does not charge
Marcus by Goldman Sachs Does not charge
Discover Bank $15 after the 6 allowed
American Express Bank, FSB. Does not charge
Synchrony Bank Does not charge
Note that these figures are reflective of fees for the New York region. Though the same fee at any given bank tends to be consistent across the country, certain fees may vary depending on where you live. We advise that you check with your local branch for the most accurate fee policy.

Excess withdrawal fee compared

According to a banking analysis by MyBankTracker, it will cost you anywhere from $3 at Bank of America® and PNC Bank to $25 at U.S. Bank for every excess withdrawal made beyond the allowed amount.

Why is there such a wide range of excess withdrawal fees at the top 10 banks? Banks simply have different policies in regards to how they implement excessive withdrawal fees to limit their customers from going beyond the six withdrawals allowed by law.

Different methods

While charging after the six-per-month withdrawal limit is the industry standard, some banks take different approaches. For example, Bank of America® and PNC Bank both charge a $3 fee after a customer makes three withdrawals out of a savings account per statement cycle.

In addition, PNC Bank charges $15 per each withdrawal beyond three withdrawals. Also, anytime the account balance falls below $1,500, each withdrawal will incur a $3 charge.

Transactions that lead to excess withdrawals

During any monthly statement period, you may make no more than six withdrawals or transfers out of these accounts through online banking or by any other electronic means. This includes preauthorized transfers made from your savings account (including transfers for overdraft protection), telephone, online banking or bill payment. It also includes transfers by check, draft or debit card -- if it is allowed on your savings account.

Transactions that do not lead to excess withdrawals include those made in person or through an ATM machine, a check, messenger, or at a branch. These transactions will not be counted towards the allowed six withdrawals for the month.

Note that banks will count a transaction on the date it's posted to your savings account. This date may be different from the date you authorize, which means it may be counted on your next statement cycle, depending on when you make it.

Excess withdrawal consequences

When excess withdrawals start to pile up on your savings account, your bank may contact you. If excessive withdrawals beyond the limit of six continue to occur, the bank may close the account or convert it to an account without transfer limitations (such as a checking account). Note that checking accounts pay little or no interest on the funds. Some banks will simply refuse to honor any additional transactions after the six allowed per month.

For example, Citibank does not have a fee for excess withdrawal transactions because it's not allowed. The bank will simply refuse the transaction and you will not be charged for it. However, they may then convert your savings into a checking account.

Either way, you shouldn't withdraw from your savings account too many times, as you might lose the benefit of holding money in an account that can build interest.

Avoiding excess withdrawal fee

There are several ways you can avoid excess withdrawal fees. For one, it is recommended that you do not use a savings account as your online bill payment account because there are limits on electronic transfers. Instead, you should withdraw money directly from a branch or at an ATM since there are no limits on these transactions.

Another trick is to open multiple savings accounts in case you need to make withdrawals out of them.

Here are some most popular online savings accounts:

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Monday, 25 Aug 2014 8:53 PM
<p>I've only made withdrawals from my savings account for "big purchases." I was saving for an apartment. When I found one and needed first month's rent and a security deposit, I made the withdrawal from my savings. Luckily I bank with Ally and there are no ATM withdrawal fees for their money market savings.</p>
Monday, 18 Aug 2014 4:01 PM
<p>I utilize my savings account to keep my money safe while traveling abroad. Instead of keeping all of my travel funds in my checking account -- which increases the vulnerability of my funds in case of theft -- I keep a majority of it in the savings account and transfer money into my checking account throughout my travels.</p><p>When do you make withdrawals from your savings account?</p>