Large Cash Deposit/FDIC after 2012

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Large Cash Deposit/FDIC after 2012

Postby bigH » Tue Apr 10, 2012 11:42 am

Hi All,

Hope everyone is healthy and well. I know this topic comes up sometimes, but with the law changing in 8 months it is good to be current.

I currently have a non-interest bearing account (with TD bank in PA0. Until the end of Dec 2012, ANY funds (no limit) in the account are covered. Past that, I am looking at options for protecting the deposits. The cash will be distributed eventually, but even if it is sitting there for a few weeks/months, I'd like it to be secure. What will bogelheads do to protect deposits past 2012 in excess of 250k/500k?

Thanks
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Re: Large Cash Deposit/FDIC after 2012

Postby donall » Tue Apr 10, 2012 12:24 pm

FDIC limits are actually more generous than most people think. Please refer to the FDIC link that explains ownership and has excellent examples.
http://www.fdic.gov/deposit/deposits/in ... rship.html
In most cases one could just retitle ownership of accounts.
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Re: Large Cash Deposit/FDIC after 2012

Postby bigH » Tue Apr 10, 2012 7:11 pm

I know you can do alot with personal accounts but what about when you have a business account and only one name for the business?
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Re: Large Cash Deposit/FDIC after 2012

Postby stan_the_man » Tue Apr 10, 2012 11:51 pm

You can always open up accounts at other banks to limit your exposure -- since you have a new deposit insurance limit at each bank (not branch).
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Re: Large Cash Deposit/FDIC after 2012

Postby CaliJim » Wed Apr 11, 2012 12:21 am

Short term treasury bills are a good option too.

Vanguard Federal Money Market Fund (VMFXX) if you have access to it.
Last edited by CaliJim on Wed Apr 11, 2012 8:54 pm, edited 1 time in total.
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Re: Large Cash Deposit/FDIC after 2012

Postby TN_INVEST » Wed Apr 11, 2012 10:57 am

What has your banker advised?

Perhaps the CDARS program would work?
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Re: Large Cash Deposit/FDIC after 2012

Postby bigH » Fri Apr 13, 2012 11:06 pm

TN_INVEST wrote:What has your banker advised?

Perhaps the CDARS program would work?


My banker said we are one of the safest banks in the country. I take lightly after everything that happened in 2008. One lesson from the financial crisis you never know how safe a back is until crisis hits where it really gets tested.
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Re: Large Cash Deposit/FDIC after 2012

Postby nisiprius » Sat Apr 14, 2012 2:05 pm

Just for something to do, I'd see what ratings BankRate and BauerFinancial give your bank. I don't know how much credence to give those ratings, but at least it's an independent check of what your banker is telling you. The ratings are not phony in the sense that, yeah, lots of real banks do get imperfect ratings. "Our" bank gets three out of five stars at BankRate, for example. I have the sense that BauerFinancial might have a bit of "grade inflation" relative to BankRate. They have reports that don't mean much to me that explain the various financial ratios they used to get the ratings.

http://www.bankrate.com/rates/safe-soun ... earch.aspx
http://www.bauerfinancial.com/btc_ratings.asp
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Re: Large Cash Deposit/FDIC after 2012

Postby Bongleur » Thu Apr 26, 2012 11:37 pm

Also check Weiss. They email you when the rating changes.

weisswatchdog.com/
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Re: Large Cash Deposit/FDIC after 2012

Postby TN_INVEST » Fri Apr 27, 2012 8:57 am

bigH wrote:
TN_INVEST wrote:What has your banker advised?

Perhaps the CDARS program would work?


My banker said we are one of the safest banks in the country. I take lightly after everything that happened in 2008. One lesson from the financial crisis you never know how safe a back is until crisis hits where it really gets tested.


Did he give advice, or did he just tell you they were a safe bank?

If you have a good banking relationship, he ought to be able to work with you on a few things. I know the private bankers around here will do that. CDARs is often one of the approaches. It's not always advertised, and not everybody at the bank knows it exists (your bank might not even offer it).
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