Money market deposit accounts are FDIC-insured savings accounts that provide interest rate-based earnings. As a conservative investment option, this savings account is often provided by banks as an alternative to standard checking accounts or certificates of deposit. Typically, money market deposit accounts feature higher returns than a checking account and offer easier withdrawal regulations than a CD. Withdrawal requirements include FDIC-mandated limits and possibly bank-imposed account rules.
Withdrawal Count
Money market deposit accounts typically allow you to make withdrawals up to six times per withdrawal period. The exact number of withdrawals and period length depends on your bank's guidelines. Some banks impose lower withdrawal rules based on how you remove the funds from your account. For example, some banks may limit check withdrawals to three per month, while others may put greater restrictions on ATM or debit card withdrawals. If you have automatic withdrawals on your account to pay for loans or routine financial obligations, they will count toward the maximum withdrawal limit.
Withdrawal Period Length
FDIC regulations allow some flexibility in how your bank calculates the withdrawal period on your account. Your bank can choose to set a monthly cycle, a four-week cycle or potentially a set number of days per cycle. Additionally, your bank can select how to establish the time a withdrawal is counted toward your limit, based on the date the funds are withdrawn from your account or when you initiated the withdrawal. For example, a check written on your money market deposit account could count against your withdrawal limit on the day you wrote it, the date it was deposited or the date the funds were removed from your account to cover the check distribution.
Withdrawal Amount
You can withdraw amounts from your money market deposit account until you go below your minimum balance requirement. Your bank may restrict access to your account once you reach your limit. The bank also may halt withdrawals that put you below your minimum or levy a fee for violating account minimums. Some banks require advance notification of large withdrawals.
Violation Rules
The FDIC requires banks to prevent you from withdrawing funds more than six times per withdrawal cycle or to establish a violation policy. Many banks opt to contact you if you pass the withdrawal limit more than one time. They may advise you that you will lose your money market account status if you continue to violate the withdrawal limits. Additional violations may result in your account being changed to a standard checking account.
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