Definition
An electronic money movement between U.S. bank accounts over the Automated Clearing House network: direct deposits, bill payments, and bank-to-bank transfers. Standard ACH settles in one to three business days, with same-day options growing. Transfers are typically free or nearly free, unlike wires.
Why it matters
ACH is the plumbing behind most of your money's movement. Knowing its timing prevents overdrafts from payments that leave your balance days after you click send.
Example
You schedule a $1,200 rent payment on the 1st. The ACH debit posts on the 3rd, but the money is spoken for the moment you send it: spending it in between is how a $35 overdraft fee happens.
Related terms
This definition is educational, not financial, legal, or tax advice. U.S. rules and limits change; verify time-sensitive details with official sources. See our disclaimer.