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FDIC and Banks- Am I Covered?

March 13, 2023

With the recent bank failures, FDIC insurance has gotten nationwide coverage. For most people, a limit of $250,000 per depositor is above what they have in the bank.  But you might have more, and it is imperative that you understand the FDIC coverage rules.

 

Per the FDIC website:

The standard insurance amount is $250,000 per depositor, per insured bank, for each account ownership category.

 

The FDIC provides separate coverage for deposits held in different account ownership categories. Depositors may qualify for coverage over $250,000 if they have funds in different ownership categories and all FDIC requirements are met.

 

All deposits that an accountholder has in the same ownership category at the same bank are added together and insured up to the standard insurance amount.

 

Steps to take:

  1. Verify the bank is covered under FDIC insurance. (Credit unions have a separate insurer and you need to look at those coverages separately).
  2. Verify how much you have in each bank. 
  3. If more than $250,000, do you have accounts in different account categories? Do you have them in joint name, in a revocable trust name, or with Transfer on Death designations? For example, a revocable trust with 5 beneficiaries could have up to $1,250,000 coverage.  Review online and Calculate insurance coverage: Use the FDIC's online Electronic Deposit Insurance Estimator (EDIE) at: https://edie.fdic.gov.  Call your bank to verify coverage if unsure.
  4. Include any Certificate of Deposits you may hold at the bank or through your brokerage account.
  5. Stay in tune for any changes to FDIC insurance. Currently, the FDIC website states: 

All the rules discussed in this brochure are current through March 31, 2024. The rules for revocable trust accounts (including formal trusts, POD/ITF) and irrevocable trust accounts discussed in this brochure will change on April 1, 2024. For most trust depositors (those with less than $1,250,000), the FDIC expects the coverage levels to be unchanged.

 

Leslie Trowbridge, CFP®

Family First Financial Planning

Hourly fee financial planner located in Cornelia, Georgia, serving clients throughout Georgia. Helping clients through fiduciary, objective, advice about retirement, investments, estate planning, college, and more. When you need a financial hand to hold, contact me at 772-781-7648. Main office is in Florida, but I cover Georgia.

 

Photo by Cytonn Photography on Unsplash