Can You Spend From a Savings Account?

Businessman taking money at an ATM in the city.

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Savings accounts are a great place to keep cash. You'll earn interest, and the money is accessible if you need it. But just how accessible is it? Can you write a check from a savings account? How about making online purchases with that money? Can you set up recurring bill payments? The answer to these questions is generally no.

Banks don't issue debit cards for savings accounts, and they rarely allow you to write checks for payments and purchases. Your money is meant to be tucked away, safe from spending, accumulating for some future goal.

Why You Can't Make Payments

Savings accounts aren't designed or intended for transactions. They're meant for long-term storage of money. In fact, federal law sets limits for withdrawals from savings accounts. The law is known as Regulation D, and it's tied into a rule that says banks must keep a certain amount of money in reserve.

You can make as many withdrawals as you like from a checking account. You can write checks, use your debit card, set up electronic bill payments, or withdraw funds at an ATM. Regulation D limits these types of transactions to six per month from savings accounts.

You’d might run over the federal limit if no restraints were placed on savings account debits, withdrawals, or payment transactions, and your bank would get in trouble if you did.

The Federal Reserve passed an interim rule to delete this six-per-month limit on savings on April 24, 2020, and then it effectively renewed this legislation on March 12, 2021. Customers can make unlimited withdrawals and transfers from savings accounts, at least for the time being during the fallout from the Coronavirus pandemic. There's been no indication that this change will be permanent, however.

There's no limit to the number of deposits you can make into a savings account each month.

You Have Other Banking Options

You have a couple of choices if you want an account that pays interest but also offers you the ability to spend your money easily: interest checking accounts and money market accounts.

Interest checking accounts are just what they sound like. They pay interest on your cash but without a monthly transaction limit. The interest rates are often lower than what you can get in a savings account, in exchange for this convenience, but online interest checking accounts at least pay competitive rates.

Money market accounts are like souped-up savings accounts. They pay better interest rates than regular savings accounts, and you're allowed to write checks from them. You might even be given a debit card for spending.

You’d normally have that same six-per-month limit on a money market account that's normally imposed on savings accounts, however. And some banks lower the monthly limit to three transactions for these accounts. They're not ideal for everyday use, but they might meet your needs if you only want to occasionally write checks on your savings.

Otherwise, and assuming that the Regulation D rule is reinstated at some point in the future, you still have six chances to move the money you need for the month. Here are some other ways to keep your cash accessible.

Make One Transfer to Checking

Transfer what you’ll need for the whole month to your checking account so you can spend from that account instead. These types of transfers are still normally limited to six per month, but you should be able to do this all at once and get enough out each month with a little advance planning.

Open a checking account for this purpose if you don't already have one. Try a prepaid account if you’re unable to open a checking account at a bank or credit union.

Get a Check

You can have the bank print a check from your savings account and have it made out to you as the account owner. This type of transaction shouldn't count against your monthly limit, again assuming that the Regulation D limits are imposed again at some point in the future.

You can also request a check payable to somebody else, but check with your bank first. You'll probably need to sign forms, and it will count against your six transactions, if it's even allowed in the first place.

Frequently Asked Questions (FAQs)

What is a high-yield savings account?

A high-yield savings account offers higher interest rates on deposits than the average. These high-yield accounts are the accounts least likely to allow you to write checks. In exchange for earning more money for their deposits, high-yield accountholders may sacrifice other conveniences like frequent withdrawals or check-writing privileges.

How much interest does a savings account earn?

As of December 2021, the average savings account in the U.S. earns 0.06% interest. That's twice what interest checking accounts offer (0.03%), and it's just under what money market accounts offer (0.07%).

Article Sources

  1. Board of Governors of the Federal Reserve. "Regulation D: Reserve Requirements," Page 3. Accessed Dec. 28, 2021.

  2. Federal Register. "Regulation D: Reserve Requirements of Depository Institutions." Accessed Dec. 28, 2021.

  3. Consumer Financial Protection Bureau. "Is There a Limit on How Much I Can Deposit Into My Savings Account?" Accessed Dec. 28, 2021.

  4. Patelco Credit Union. "Money Market Accounts." Accessed Dec. 28, 2021.

  5. Federal Deposit Insurance Corporation. "National Rates and Rate Caps." Accessed Dec. 28, 2021.