The recent news of the banking fiasco has gotten people nervous about the safety of their funds, how would they know it’s safe, and any steps they should be doing. To answer the first concern, if your bank is insured by the Federal Deposit Insurance Corporation (FDIC), then your money would be safe, but only up to $250,000.
Not all financial accounts are protected by the FDIC. Checking and savings accounts, Certificates of Deposit, and money orders are some common items covered by the FDIC. What’s not covered includes stocks and bonds investments, life insurance policies, and safe deposit boxes, to name a few. Remember that non-bank companies and any financial institution that doesn’t have their banking license are never insured by the FDIC.
If your bank is covered by the FDIC and fails, your funds are safe up to $250,000. The FDIC will reimburse your funds to another FDIC-insured bank and send you notification. If you have more than $250,000, you are only guaranteed this amount, although you may receive more. Experts suggest opening multiple FDIC-insured accounts to ensure protection if you have funds exceeding $250,000. Joint accounts receive an increased $500,000 of FDIC protection, so if you can add someone you trust, you can double your protection.
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