Do you want to know the vital importance of the FDIC? Need to know the answer? Then keep reading to find out! Understanding the powerful role of the FDIC is critical to anyone with secure savings and investments.
The FDIC stands for the Federal Deposit Insurance Corporation, which is essentially a savings insurance policy for the bank you put your money in. So, if the bank fails, FDIC insurance covers up to $250,000.00 per depositor, per account titling (account titling meaning individual or joint).
It's important to be aware that anything over $250,000.00 isn't protected by FDIC insurance, and considering recent events with Silicon Valley Bank, it's more important than ever for you to take steps to make sure you're fully covered. It's best to talk to an advisor that can help you know what measures need to be taken to make sure all of your funds, above the $250,000.00 limit, are protected.
To give you a better understanding of the FDIC, here's a brief example of how it works:
Example #1: Individual account
Beaux T. Full has a personal bank account at BHM Bank, which currently has a total balance of $500K. However, only $250K of that amount is covered by FDIC insurance, so the remaining $250K is not protected.
Example #2: Joint account
Lee Mon Pepper and Sea Soning have a joint account with a balance of $500K. Each of them contributed $250K, so the account balance is fully covered by both of them - since it's a joint account!
Be sure to double check that any bank you're doing business with (even if you're already a customer) is FDIC insured – it's important that your funds are fully covered! For more information, visit ➡️ FDIC.gov.
I strongly recommend that you take the initiative to learn more about FDIC by visiting the FDIC.gov website. That way, when you get in contact with your banker/relationship manager, they can help clarify any of the important concepts that you may not understand. They can provide detailed information to further explain the structure of FDIC and how it affects you.
Thanks for reading!
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