Definition of Withdrawal

It is a transaction in which a customer receives back money he/she had previously deposited at a bank, pension, or trust.

Explanation of Withdrawal

When one makes a withdrawal on a pension or similar plan, it may carry a penalty depending on the pension’s rules. For example, one must usually be of a certain age in order to make a withdrawal. There is rarely such a penalty when making a withdrawal from a bank. For instance, when one closes an account, the client makes a withdrawal on all the money he/she owns at that bank.