The Stock Market Meltdown - Is Your Investment Safe?

In light of the current financial sector failures, some people have expressed concerns regarding the current stability and solvency of the banking industry and more specifically, regarding the safety of personal funds and investments.

Therefore, We are making available some of the Federal Deposit Insurance Corporation (FDIC) Internet resources that comprehensively address many questions and concerns being expressed throughout the country.

The FDIC has published a brochure titled “When a Bank Fails-Facts for Depositors, Creditors, and Borrowers.” This brochure should comprehensively answer most of the questions and concerns of every Americans and investors in particular.

Here are some questions people are asking:

What Does the FDIC Insure?
The FDIC is a government corporation that insures all deposits at insured banks, including checking and savings accounts, money market deposit accounts, and certificates of deposit (CDs), up to the insurance limit.

How Much Does The Insurance Cover?
The basic insurance amount is $100,000 per depositor per insured bank. Certain retirement accounts, such as Individual Retirement Accounts, are insured up to $250,000 per depositor per insured bank.

How Do I Increase My Insurance Coverage?
Since accounts at different banks are insured separately, the easiest way to increase your coverage is to simply keep less than $100,000 at any one bank. You could have $100,000 each at 500 different banks, and be insured for $50 million in total.

You may also qualify for more than $100,000 in coverage at one insured bank if a wife and husband own deposit accounts in different ownership categories.

How Do I Know If My Bank Is Insured?
Use the FDIC Bank Find to answer questions like: Is My Bank Insured? Is My Bank Insured? Where is My Bank's Home (Main) Office Located? What is My Bank's Web Site Address? What Happened to My Bank (Historical List of Events)? Does My Bank have a New Name? Is My Bank Still Open? And More.

What Happens If My Bank Really Fails?
Firstly, the FDIC does not notify people that their bank is about to fail or has failed. The only way for you find out is when your debit card gets denied or you walk up to your bank and it has a new name. Here is a list of banks that have failed since October 2000, that includes a summary how it was handled.

The Finance Buff shares with us what happens when your bank goes out of business. The example given is Metropolitan Savings Bank in Pittsburgh, which the FDIC took over recently.

Example Of A Possible Bank Failure
Here’s a good example of what could happen when a bank fails and the FDIC steps in: The FDIC announced the bank’s takeover on Thursday. By Monday the deposits have been taken over by another bank, the branches were re-opened, and the insured people have access to their money again.

But, out of the $12 million in deposits in the bank, there were 30 account holders with total assets of $1.2 million not insured by the FDIC. Those people are now creditors to the receivership of the failed bank, and must wait as the FDIC liquidates the bank’s remaining assets. The process could be a long drawn out one before you know if you will get any of your money back.

Additional Information:
Request a copy of “Your Insured Deposits,” which provides a detailed discussion on all the ownership categories, or by calling toll free 1-877-275-3342.

Calculate your insurance coverage on-line using the FDIC’s Electronic Deposit Insurance Estimator.


Contact the FDIC - Call toll-free at 1-877-ASK-FDIC (1-877-275-3342) from 8 a.m. until 8 p.m. Eastern Time, Monday through Friday. For TDD call 1-800-925-4618. Learn more about FDIC insurance on-line.


Send your questions by e-mail using the FDIC’s on-line Customer Assistance Form.

Mail your question to:
FDIC
Attn: Deposit Insurance Outreach
550 17th Street, N.W.
Washington, DC 20429-9990




Disclaimer: The content in this document is intended to present available information in a non-technical way and is not intended to be a legal interpretation of FDIC regulations and policies.