You can use the FDIC Information and Support Center to submit your query. You can also call the FDIC at 1-877-275-3342 or 1-877-ASK-FDIC.
The Federal Deposit Insurance Corporation (FDIC) plays a crucial role in safeguarding your money deposited at insured banks. However it’s essential to understand that not all financial products offered by banks are protected by FDIC insurance. This guide will explore which products are covered and which are not helping you make informed decisions about your finances.
What is FDIC Insurance?
FDIC insurance is a government-backed guarantee that protects your deposits at insured banks up to specific limits. This insurance ensures that even if a bank fails, you won’t lose your money. The standard insurance amount is $250,000 per depositor, per insured bank, for each account ownership category. This means that if you have different types of accounts (checking, savings, CDs) at the same bank, your total coverage may exceed $250,000, depending on the ownership category.
What Products are Covered by FDIC Insurance?
The following deposit products are typically covered by FDIC insurance:
- Checking accounts
- Negotiable Order of Withdrawal (NOW) accounts
- Savings accounts
- Money Market Deposit Accounts (MMDAs)
- Time deposits, such as Certificates of Deposit (CDs)
- Cashier’s checks, money orders, and other official items issued by a bank
What Products are NOT Covered by FDIC Insurance?
The following products are NOT covered by FDIC insurance. even if you purchased them from an insured bank:
- Stocks
- Bonds
- Mutual funds
- Crypto assets
- Life insurance policies
- Annuities
- Municipal securities
- Safe deposit boxes or their contents
- U.S. Treasury Bills, Bonds, or Notes (These investments are backed by the full faith and credit of the U.S. government, but not by FDIC insurance.)
Why is it Important to Know What’s Not Covered?
Understanding which products are not covered by FDIC insurance is crucial for making informed investment decisions. These products may involve higher risks, and their value can fluctuate with market conditions. It’s essential to research and understand the risks involved before investing in any non-deposit product.
How to Identify Non-Deposit Investment Products
When considering investment products offered by banks, look for the following clues to determine if they are FDIC-insured:
- Disclosures: Sales representatives must disclose orally or in writing whether the product is FDIC-insured. Phrases like “This product is not a deposit…” or “This product is subject to investment risks…” indicate that it’s not covered by FDIC insurance.
- Logos: Look for the FDIC logo in advertisements and brochures. Its absence suggests that the product is not FDIC-insured.
Understanding FDIC insurance and its limitations is essential for safeguarding your money. By knowing which products are covered and which are not, you can make informed decisions about your finances and choose investments that align with your risk tolerance and financial goals. Remember, always do your research and consult with financial professionals before investing in any non-deposit product.
Frequently Asked Questions (FAQs)
1. What happens if my bank fails?
If your bank fails, the FDIC will act quickly to ensure that all depositors get prompt access to their insured deposits. In most cases, another bank will acquire the failed bank, and customers will be able to access their money through the acquiring bank. If the failed bank is not acquired, the FDIC will provide instructions for accessing your money.
2. How can I calculate my FDIC insurance coverage?
You can use the FDIC’s Electronic Deposit Insurance Estimator (EDIE) to calculate your specific insurance coverage amount. This online tool allows you to input your account information and determine how much of your money is insured.
3. What should I do if I have a complaint about a deposit or investment?
If you have a complaint or concern, try to resolve it directly with the bank or firm before involving an outside agency. If you’re unable to resolve the matter, you can contact the appropriate regulatory agency based on the type of product or institution involved.
4. Where can I find more information about FDIC insurance?
The FDIC website provides a wealth of information about deposit insurance, including brochures, FAQs, and online tools like EDIE. You can also contact the FDIC Information and Support Center for assistance.
Additional Resources
- FDIC Deposit Insurance: https://www.fdic.gov/resources/deposit-insurance/
- FDIC Financial Products That Are Not Insured: https://www.fdic.gov/resources/deposit-insurance/financial-products-not-insured/
- FDIC Electronic Deposit Insurance Estimator (EDIE): https://edie.fdic.gov/
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How do I know that my money is insured?
Opening a deposit account at a bank that is FDIC-insured automatically entitles you to FDIC insurance coverage. By using the BankFind tool on our website, www.bankfind.com, you can verify if your bank is covered. fdic. gov or you can call the FDIC at 1-877-ASK-FDIC (1-877-275-3342).
How much of my money is insured?
For each category of account ownership, the standard insurance amount is $250,000 per depositor per insured bank. The FDIC adds up all of the deposit accounts you own at the same bank in the same ownership category, regardless of the type of deposit, to determine an individual’s coverage amount (e g. Money market deposit accounts (MMDAs), savings accounts, checking accounts, and certificates of deposit (CDs)
Accordingly, if all conditions are satisfied and you have deposits in various account types at the same FDIC-insured bank, your insurance coverage may exceed $250,000.
If you have accounts at multiple FDIC-insured banks, the maximum of $250,000 per depositor for each account ownership category is applicable at each bank.
The FDIC’s website has an Electronic Deposit Insurance Estimator (EDIE) calculator that you can use to determine the exact amount of insurance coverage you have.