Understanding The Power Of Federal Insurance
A financial institution is one of the safest places to keep your hard-earned cash. Not only will you watch your money grow by earning dividends, but it will also remain protected from most risks of keeping cash on hand.
Your Money Is Insured
There are two organizations, both backed by the United States government, that insure your money at participating institutions. The NCUA (National Credit Union Administration) provides coverage for credit unions, and the FDIC (Federal Deposit Insurance Corporation) does the same for banks. These organizations both function as safety nets for your deposits.
Up to $250,000 is protected by these institutions (and possibly more, depending on the type of account). Because of this protection, insured banks and credit unions and the covered accounts within them are one of the safest places that you can keep your money.
Protected accounts include deposit accounts such as checking and savings accounts, money market deposit accounts, CDs, share certificates, and IRAs. Almost all credit unions and banks offer NCUA or FDIC protection to their account holders. You can verify that you're covered by visiting your institution's website or by giving them a call.
Exactly How Much Money Is Insured?
How much coverage you have depends on what category your account falls into. If you have a savings account and a checking account, those are both in the single-owner account category, so they would be insured for a total of $250,000. But if you had accounts of different types—say, a checking account and an IRA, each account would be insured for $250,000, meaning you would have a total of $500,000 of protection.
Are Trust & Joint Accounts Insured?
The rules change a little when it comes to joint accounts and trusts. Joint accounts are protected for $250,000 per owner. So, if you have a joint account with your spouse, it would be insured for a total of $500,000. Trust accounts are generally insured for $250,000 per beneficiary. Meaning if you have 3 beneficiaries listed in the trust, it would be protected for up to $750,000. In other words, only a trust’s beneficiaries are protected, not a trust’s owner.
Are There Other Ways To Protect My Money?
Other recommended securities can include utilizing the mobile wallet option for debit and credit card use, keeping your devices up to date, using strong passwords for online banking and mobile banking, and keeping your personal information secure from prying eyes either in person or online. And as always, monitoring your account activity daily is one of the best ways to protect your money. Your chances of finding unauthorized activity and a resolution to the problem will increase with consistent surveillance and early detection.
If you want to get more information about your situation and find out the best way to ensure that all of your money is protected, you can talk with one of our friendly Financial Service Representatives by calling 315-735-8571or by scheduling an appointment online today.
Bring This Session To A Live Setting
If you would like to schedule our Community Educator for a seminar or workshop for any Financial Friday educational topic, please email your request to FinancialEducation@fsource.org