8 Things You Need To Know About FDIC And Your Accounts

July 15, 2008

With the recent failure of IndyMac Bank people are asking: how safe are my deposits and what exactly is insured. FDIC has a wonderful web site, but the 8 things you need to know are:

  1. Deposits for an individual are insured up to $100,000.
  2. Joint deposits for 2 individuals are insured up to $200,000.
  3. Retirement Accounts such as an IRA are insured up to $250,000.
  4. Business Accounts are insured up to $100,000.
  5. Having multiple accounts at branches of the same bank does NOT increase your insurance.
  6. Having different deposit accounts at the same bank does not increase your coverage. All of your individual accounts are added together.
  7. If you have a loan that is secured with a c.d. or other deposit account, the FDIC may be able to satisfy the loan first. What’s left of your deposit account will be insured up to above stated limits. This is the “doctrine of offset” and is not a rule.
  8. Brokerage accounts are NOT insured by the FDIC. However certain accounts held at a brokerage firm may be insured, such as cash accounts. You need to check with your broker.

FDIC Your Insured Deposits

This chart by FDIC explains by example common questions concerning joint accounts:

If you still have questions, FDIC has an interactive site that will calculate for you the insurance coverage of your accounts.

We are in troubling economic times. It is important to know how to protect your wealth.


John Newcomer