How Much Are You Insured for at a Bank?

Deposit insurance plays an important role in the United States financial system by protecting the money people hold in banks and credit unions. This protection instills public confidence and maintains stability, ensuring funds remain secure even if a financial institution fails. It safeguards depositors’ money, reducing the likelihood of widespread withdrawals. This system provides a safety net, allowing individuals to trust their savings are protected.

Standard Deposit Insurance Coverage

The standard amount of deposit insurance coverage is $250,000 per depositor, per insured financial institution, for each account ownership category. This limit was made permanent by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The Federal Deposit Insurance Corporation (FDIC) insures deposits in banks and savings associations. The National Credit Union Administration (NCUA) provides insurance for deposits at federally insured credit unions.

These agencies protect money held in common deposit accounts, including checking accounts, savings accounts, money market deposit accounts (MMDAs), and Certificates of Deposit (CDs). The phrase “per depositor, per insured institution” means that if an individual has multiple accounts at the same bank, such as a checking account and a savings account, the balances of these accounts are combined for the $250,000 limit, assuming they are under the same ownership category. If an individual has deposits at different branches of the same insured bank, those deposits are also aggregated and counted together toward the $250,000 limit for that single institution.

Maximizing Coverage Through Account Ownership

Individuals can secure insurance coverage exceeding the standard $250,000 limit at a single institution by holding funds in different ownership categories. Each distinct ownership category at the same insured bank or credit union is insured separately up to the $250,000 limit.

Single accounts, owned by one person, are insured up to $250,000. For example, if an individual has a checking account and a savings account solely in their name at the same bank, the combined balance of both accounts is insured up to $250,000. Joint accounts, held by two or more people with equal rights to withdraw funds, are insured for each co-owner’s share, effectively providing $250,000 per co-owner. A joint account with two owners can therefore be insured for up to $500,000 at a single institution.

Certain retirement accounts, such as Traditional IRAs, Roth IRAs, SEP IRAs, SIMPLE IRAs, and self-directed defined contribution plans like 401(k)s, constitute a separate ownership category. Funds in these retirement accounts are insured up to $250,000 per participant, distinct from any other individual accounts held at the same institution. Revocable trust accounts are insured up to $250,000 for each unique beneficiary named in the trust. For instance, a revocable trust with one owner and three unique beneficiaries could be insured for up to $750,000.

Other ownership categories include irrevocable trust accounts, corporation/partnership/unincorporated association accounts, and government accounts. To maximize coverage, ensure funds are placed into accounts that fall under these distinct ownership categories at the same insured institution.

Exclusions from Deposit Insurance

While deposit insurance offers broad protection for traditional bank and credit union accounts, it does not cover all financial products or assets. Certain items are excluded from coverage, even if offered or purchased through an insured financial institution.

Investment products, such as stocks, bonds, mutual funds, and exchange-traded funds (ETFs), are not insured by the FDIC or NCUA. These products carry investment risks, and their value can fluctuate. Additionally, annuities and life insurance policies are not considered deposits and are therefore not covered by federal deposit insurance.

The contents of a safe deposit box are also not insured by the FDIC or NCUA. These boxes are for safekeeping physical items, not for insured deposits. Furthermore, digital assets like cryptocurrency are not covered by federal deposit insurance. Non-deposit investment products sold by an insured bank must clearly state they are not FDIC-insured, not a bank obligation, and subject to investment risks.

Confirming Your Deposit Insurance Protection

Verifying your financial institution is insured and understanding your specific coverage is straightforward. Federally insured banks display the official FDIC sign at their branches and teller windows. Federally insured credit unions display the official NCUA insurance sign. These signs indicate that the institution’s deposits are backed by the full faith and credit of the U.S. government.

For further confirmation, online tools are available. The FDIC offers a “BankFind” tool on its website where individuals can search for a bank’s insurance status. The NCUA provides a “Credit Union Locator” for verifying credit union insurance. These resources allow for verification of an institution’s insured status.

To estimate your total deposit insurance coverage, both agencies provide interactive calculators. The FDIC’s Electronic Deposit Insurance Estimator (EDIE) and the NCUA’s Share Insurance Estimator allow users to input their account details and calculate their potential coverage. Using these tools, along with maintaining accurate records, helps ensure your deposits are protected. If questions remain, contacting the financial institution directly or reaching out to the respective federal agency can provide specific guidance.