On the surface, money-market accounts seem like the best of both worlds — higher rates than savings and the freedom to grab your cash when life happens. But here’s where things get interesting. Depending on how and when you make a withdrawal, you could run into limits or find your earnings take a hit. Turns out, “liquid” doesn’t always mean hassle-free. Let’s explore what really happens.
Withdrawal Limits Still Exist
The Federal Reserve’s Regulation D historically capped certain withdrawals from money-market accounts at six transactions per month, a rule designed to help banks maintain reserve levels. Although the Fed temporarily suspended this restriction in April 2020 because of the pandemic, many banks voluntarily continue enforcing it.
That means transferring money online, writing checks, or using debit access more than six times in a cycle may trigger excess-withdrawal fees or even force a downgrade to a regular savings account.
Banks still categorize withdrawals differently—automatic bill-pays count, but in-person teller visits might not—making it essential for you to understand how your institution defines a “convenient transaction.” Clarifying this upfront also helps avoid surprise penalties and keeps your account operating as intended.
Early Withdrawals Can Dent Earnings
Money-market accounts earn interest daily and compound monthly—meaning consistency matters. Some banks reduce your annual percentage yield (APY) for the month if you make a withdrawal before a specific interest-calculation date. That temporary drop in rate may seem minimal, but repeated or poorly timed withdrawals can cause your return to lag behind advertised earnings and even inflation.
Even when the APY is left unchanged, dipping into the balance regularly reduces the principal on which interest is calculated in the first place. So, a lower principal is equal to lower growth, even if the rate holds steady. Over time, that habit eats into your long-term gains. In short, use the account as a parking space—not a revolving door—to get the returns you signed up for.
Check Writing Isn’t Always Free
Money-market accounts often come with the perk of check-writing privileges, but using them like a standard checking account can get expensive fast. Cashier’s checks can be obtained at banks, credit unions, and sometimes online. According to Bankrate (2025), banks typically charge around $5 to $15 for each cashier’s check. Those fees add up quickly and can outweigh the interest the account earns, especially if checks are written frequently.
This setup makes occasional use practical—but heavy use costly. Treat checks from your money-market account like a backup option instead of an everyday tool. For routine spending, shifting those transactions to your primary checking account keeps your earnings intact and avoids unnecessary charges.
Some Banks Enforce Minimum Balance Fees
Several banks require a minimum balance to keep money-market accounts fee-free. According to CNBC Select, falling below a $1,000 minimum balance can result in monthly service fees, typically ranging from $10 depending on the bank. These charges are automatically deducted, reducing both your principal and the interest you hoped to earn, making the account less beneficial for fluctuating balances.
Maintaining a cushion helps you avoid dipping below the bank’s threshold during regular withdrawals or market shifts. If your balance tends to vary, consider planting a buffer of at least 10–15% above the stated minimum. That way, small withdrawals won’t accidentally trigger charges that could wipe out a month’s worth of interest earnings.
Money-market accounts reward stability, not frequent access. To get the most from your savings, know your bank’s withdrawal limits, fee structure, and balance requirements upfront. Treat the account as a holding zone—not a transaction hub—and your money continues growing quietly in the background while staying within reach when you truly need it.
