How to Keep Your Money Federally Insured After the $100,000 FDIC Limit

Recently there have been a number of different bank failures which have left people with large amounts of money deposited in savings high and dry when the dust settled. The Federal Deposit Insurance Corporation (FDIC) will insure up to $100,000 for any consumer at an individual bank and up to $250,000 for a retirement account. To most of us, we won't have to worry about exceeding these limits for many years to come, but for others, saving money above the FDIC insurance limit is a major problem. Fortunately, there are options for individuals who would like to keep their money safe well above the $100,000 limit.

NetBank is the quintessential example of why wealthy individuals should take very specific actions to keep their savings FDIC insured. Many consumers though the bank was doing just fine and had a lot of money saved there. It was FDIC insured and people never even considered that their money might not be safe. NetBank hit some hard times and went out of business and a whopping $109 million of their deposits were not FDIC insured and the people who held those deposits were simply out of luck.

In order to keep your initial deposit and the interest you earn FDIC insured, you should never deposit more than $90,000 in any one bank. If you deposited the full $100,000 into a bank and it went out of business, any interest that you earned would be lost. By only depositing $90,000, you are giving yourself some room to earn interest that is still FDIC insured.

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Credit: Matthew Paulson

Copyright: Matthew Paulson