What is the FDIC
What You Should Know About the FDIC
The world financial crisis has dried up the credit market, caused money giants like Lehman Brothers to crash, and forced gigantic banks to combine, making many folks wonder where their money will be safe. Through the FDIC or the Federal Deposit Insurance Corporation the bank is still the best place to keep your money regardless of what occurs to your bank. In October 2008 the deposit insurance was briefly raised to $250,000 per depositor thru December 31, 2009, so if your area bank falls down you can still be guaranteed your deposit up to $250,000.
Get to Know the FDIC
Established in 1933, the FDIC was created to ensure public confidence in the banking. This worked by providing all depositors in FDIC-insured banks coverage up to $5,000 (in the 30s), and second by taking over for a failed bank to collect and sell the banks assets to settle the banks debts including claims for deposits in excess of the insured amount. The FDIC receives its funding from premiums paid by insured banks as well as earnings from its investments in US Treasury securities; no federal or state taxes are used.
Are you safe?
To take advantage of the full protection the FDIC offers, there are a couple of things to bear in mind. First FDIC coverage does not extend to all finance establishments so ask your bank if they are covered or check the FDIC site to see whether you bank is listed. Second coverage is for individual deposit accounts only up to $250,000 so no stocks, bonds, safety deposit boxes, hedge funds, etc.
How About $250,000+
For coverage beyond the $250,000 there are some particular examples like making deposits under different ownership categories where excess coverage is allowed. Revocable Trust Accounts, or a deposit account opened by an individual with the stated goal of the account being turned over to a number of beneficiaries on the passing of the first account holder, can receive over $250,000. As an example if Mr. Jones has a deposit account worth $500,000, both his children would get $250,000 each if they were the beneficiaries named on the account at the time of his death. - 23204
The world financial crisis has dried up the credit market, caused money giants like Lehman Brothers to crash, and forced gigantic banks to combine, making many folks wonder where their money will be safe. Through the FDIC or the Federal Deposit Insurance Corporation the bank is still the best place to keep your money regardless of what occurs to your bank. In October 2008 the deposit insurance was briefly raised to $250,000 per depositor thru December 31, 2009, so if your area bank falls down you can still be guaranteed your deposit up to $250,000.
Get to Know the FDIC
Established in 1933, the FDIC was created to ensure public confidence in the banking. This worked by providing all depositors in FDIC-insured banks coverage up to $5,000 (in the 30s), and second by taking over for a failed bank to collect and sell the banks assets to settle the banks debts including claims for deposits in excess of the insured amount. The FDIC receives its funding from premiums paid by insured banks as well as earnings from its investments in US Treasury securities; no federal or state taxes are used.
Are you safe?
To take advantage of the full protection the FDIC offers, there are a couple of things to bear in mind. First FDIC coverage does not extend to all finance establishments so ask your bank if they are covered or check the FDIC site to see whether you bank is listed. Second coverage is for individual deposit accounts only up to $250,000 so no stocks, bonds, safety deposit boxes, hedge funds, etc.
How About $250,000+
For coverage beyond the $250,000 there are some particular examples like making deposits under different ownership categories where excess coverage is allowed. Revocable Trust Accounts, or a deposit account opened by an individual with the stated goal of the account being turned over to a number of beneficiaries on the passing of the first account holder, can receive over $250,000. As an example if Mr. Jones has a deposit account worth $500,000, both his children would get $250,000 each if they were the beneficiaries named on the account at the time of his death. - 23204
About the Author:
Educate yourself regarding FDIC insurance at MindOnYourMoney.com - click to the money site and read the complete article regarding FDIC insurance.
posted by X - Men @ 12:52 AM
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