Most of us have had that moment — you open a new bank account for some specific purpose, maybe to park a tax refund or save for a trip, and then life happens. You stop logging in. The statements pile up unopened or go straight to the junk folder. A year goes by, then two. You might assume the money is just sitting there waiting for you whenever you get around to it. But that’s not quite how it works.
Banks don’t just hold onto forgotten accounts forever. There’s a whole process that kicks in when an account goes quiet for too long, and it can involve fees eating away at your balance, your account being frozen, and eventually your money being handed over to the state government. It’s called escheatment, and it affects a staggering amount of money in this country — an estimated $70 billion, according to the National Association of Unclaimed Property Administrators.
How a Bank Account Goes Dormant
The journey from “active account” to “dormant account” is more gradual than you might expect. Generally, a bank will flag your account as inactive after about six to twelve months of no customer-initiated transactions. That means no deposits, no withdrawals, no transfers, no logins — nothing that shows you’re aware the account exists. Automatic fees charged by the bank don’t count as activity, and neither does interest the bank posts to your account.
Once the account is flagged as inactive, things start to change. Some banks begin charging monthly inactivity fees, typically in the range of $5 to $20 per month, according to SoFi’s guide to inactivity fees. If you had a modest balance sitting in that forgotten account, these fees can slowly eat through it. An account with $200 in it could be completely drained in less than two years by a $10 monthly inactivity fee alone.
After a longer period of inactivity — usually one to three years depending on the bank’s internal policies — the account may be classified as “dormant.” At this point, the bank may restrict certain transactions and begin making efforts to contact you. They’re required to reach out before taking the next step, which is where escheatment comes in.
Escheatment: When the State Takes Your Money
Escheatment is the legal process by which unclaimed financial assets are turned over to the state. Every state has its own escheatment laws, and the timelines vary quite a bit. According to a 2026 breakdown of escheatment laws by state, most states require banks to turn over dormant account funds after a period of three to five years of inactivity. States like North Dakota and Pennsylvania move faster, with dormancy periods as short as two years. Others, like Delaware and Wisconsin, give account holders five years before the clock runs out.
Before the bank hands your money to the state, they’re generally required to send you a written notice — often called a “due diligence letter” — giving you a window to reclaim the account by making a transaction or contacting the bank. If that letter goes to an old address and you never see it, though, the process moves forward without you.
It’s important to understand that escheatment doesn’t mean your money is gone forever. The state holds it as unclaimed property, and you can file a claim to get it back. But the process of recovering escheated funds can be slow and bureaucratic. You’ll typically need to prove your identity, show that you’re the rightful owner, and wait weeks or months for the claim to be processed.
$70 Billion in Unclaimed Property — Some of It Might Be Yours
The scale of this issue is remarkable. State treasurers across the country are collectively holding roughly $70 billion in unclaimed property from about 33 million people. And this isn’t just dormant bank accounts — it includes uncashed checks, forgotten security deposits, old insurance payouts, and abandoned safe deposit box contents. But bank accounts make up a significant portion.
In 2023 alone, states returned over $5 billion to people who filed claims, with the average claim value coming in at $1,154. That’s not pocket change. And new trends are expanding what counts as escheat-able property. Several states are now updating their laws to include digital assets and cryptocurrency, meaning that forgotten crypto wallets and digital payment balances could also be subject to escheatment in the near future.
How to Protect Your Accounts From Going Dormant
The simplest way to keep an account active is to make at least one customer-initiated transaction every few months. It doesn’t have to be anything major. Logging into your online banking, making a small transfer between accounts, or setting up a small recurring deposit can all reset the inactivity clock. Even something as small as a $1 monthly automatic transfer from your checking to your savings counts.
If you have accounts at multiple banks — which is increasingly common as people spread their money across high-yield savings accounts, traditional checking, and various fintech apps — it helps to do a periodic inventory. Make a list of every financial account you own and check in on each one at least quarterly. This is also a good habit for security reasons, since dormant accounts that you’re not monitoring are more vulnerable to fraud.
It’s also worth updating your contact information every time you move. That due diligence letter the bank sends before escheatment can only help you if it actually reaches you. If you’ve moved and haven’t updated your address with every bank where you hold an account, you could miss the one warning that would have given you a chance to act.
Check If You Already Have Unclaimed Money
Here’s the part that might actually put money back in your pocket today. Every state maintains a database of unclaimed property, and you can search them for free. The best starting point is MissingMoney.com, which aggregates unclaimed property databases from most U.S. states into a single search. You can also check directly with the unclaimed property office for any state where you’ve lived, worked, or held a bank account, through the NAUPA website.
Search using your current name, any previous names, and old addresses. If you find a match, filing a claim is usually free — be wary of any third-party service that wants to charge you a percentage of your unclaimed property, since you can almost always recover it yourself at no cost.
The Bigger Lesson About Account Management
Dormant accounts and escheatment are really just symptoms of a broader issue: losing track of your money. In an era when it’s easier than ever to open new accounts — a few taps on your phone and you’ve got a new savings account or investment portfolio — it’s also easier than ever to accumulate financial clutter. Each forgotten account represents money that isn’t working for you, whether it’s earning interest, building toward a goal, or simply being where you can actually use it.
Taking thirty minutes once or twice a year to audit your financial accounts is one of those small maintenance tasks that can pay off in a surprisingly big way. Close the accounts you don’t need, consolidate where it makes sense, and make sure every dollar you’ve earned is somewhere you can see it and put it to work.