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Wells Fargo Presents: Making Sense…of Excess Activity
So, what is “Excess Activity”?
Excess activity is certain transfers and withdrawals from your savings or money market account
over the limit of 6 transactions per monthly statement period.
That’s the simple answer. But it begs the question… why are there limits on how often
you can use your own money? There’s a specific reason for this.
But, before we jump into specifics, let’s first look at the different kinds of accounts
banks offer.
First up, checking accounts. These are your “on demand” transaction accounts. In other
words, money you can access at any time.
You can use it to write checks, to withdraw money with your debit card, pay your bills,
and transfer money as often as you’d like. This money is meant to move, so there are
no limits on the number of transactions you can make.
But savings accounts are different. Just look at the name. These accounts are used for SAVING.
Not for paying bills. Not for everyday use. But for good old fashioned saving.
And did you know that there’s a federal government regulation called Regulation D
that places limits on the number of certain transactions that can be made from a savings
account? And every US bank is required to enforce it.
This is to make sure that banks maintain reserves on various account types.
You’re allowed up to the federal limit of 6 certain transfers or withdrawals from a
savings account per monthly statement period. This includes online, mobile, phone, and text-banking
transactions, transfers for overdraft protection, and preauthorized automatic payments made
to third parties.
It is important to note there are NO limits on any savings account withdrawals or transfers
that you make in person at an ATM or with a teller at a branch. Of course you’re welcome
to make as many deposits into your savings account as you’d like.
Now let’s go over what happens at Wells Fargo if you exceed the limit of 6 transfers
within your monthly statement period.
Scheduled transfers and online banking transfers may be declined.
We know that these transactions are convenient – but transfers over six per month will
no longer be allowed. Watch for messages on the transfer screens that will warn you when
you are approaching the limit.
If you exceed the limit, you’ll be charged a $15 excess activity fee for transactions
over the limit. Don’t forget that Overdraft Protection transfers from your linked savings
account also count toward the limit.
Lastly, if a savings account has more than 6 transfers in a monthly statement period
on more than an occasional basis, unfortunately we are required by the regulation to convert
your savings account into a checking account or close it. We are now declining online and
mobile transfers above the limit to help prevent this from happening.
So, how do you avoid a declined transaction or excess activity fee?
Simple. The easiest way to avoid an excess activity fee is to use your checking account
for frequent transfers. That’s what your checking account is for!
Also, take a peek at your account for any recurring scheduled transfers from your savings
account. These can lead to excess activity.
If you absolutely have to transfer money out of your savings account, try this: Rather
than transferring money out for each individual expense, plan ahead and transfer enough money
for all your upcoming expenses in one larger transfer.
Finally, don’t forget that ATM and branch withdrawals or transfers are unlimited.
Just remember, your savings account is meant for saving. So if you minimize your transfers,
you’ll minimize your chance of having excess activity.
Have more questions about this or any other banking topic? Stop by your local Wells Fargo
for a conversation with your neighborhood banker.