How an FDIC Insured Bank Affects Your Accounts

The FDIC is the acronym for Federal Deposit Insurance Corporation, which is an agency of the government. The primary function of the FDIC is make sure that the deposits of customers are protected and insured in the event a bank would fail or become insolvent. What is great about this is the fact that the FDIC insurance is endorsed by or backed by the United States Government.

Here is how the FDIC operates. Lets look at an individual depositors account with a bank totaling less than $100,000 the complete deposit is fully insured. Also note a depositor is allowed to have more than $100,00 at one FDIC insured bank if and only if the account is able to meet certain requirements. Now as far as retirement accounts the agency will insure up to $250,000 for some retirement accounts.

To determine whether or not your bank or savings association is insured by the FDIC call this toll-free number at 1-877-275-3342 or you can go online at this website

You are probably wondering what types of accounts are insured by the FDIC? Well let's do a break down.

First of all the FDIC will insure accounts including deposits in checking accounts, NOW, and savings accounts, money market deposit accounts. Coverage also extends to time deposits known as certificates of deposits. (CD). The balance of each account is insured up to the limit which does include principal and any accrued interest through the bank's closing date.

Many people wonder about how this effects their stocks and bond, life insurance policies and mutual funds or even annuities or municipal securities as they pertain to the FDIC. The bad news is these are not covered by the FDIC even if you were to purchase them from an a bank insured by the FDIC.

If you have any type of U.S. Treasury bills or bonds or even notes these are not insured by the FDIC, however these are covered by the credit and faith of the United States government.