Question about FDIC insurance

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Abe
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Question about FDIC insurance

Post by Abe »

I have some CD's coming due tomorrow. I found a local FDIC insured bank that's paying 1% on 12 month CD's. This is my question. It is just my wife and myself. Will we be FDIC insured for up to 1 million at this one bank? I went to the FDIC website and put the following information in their EDIE calculator. This is what it said:
One account jointly held, wife and myself, for $250k each for a total of $500k insured.
One account in my name with my wife as beneficiary for $250k,
and one account in my wifes name with me as beneficiary for $250k insured.
So a total of 1 million FDIC insured. This is what the EDIE calculator said: Looks good. According to the information you have entered, EDIE estimates that your deposit accounts at this financial institution appear to be fully insured. Insured amount: $1,000,000. I just want to make sure this is correct.
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BigMoneyNoWhammies
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Re: Question about FDIC insurance

Post by BigMoneyNoWhammies »

Are the accounts you mentioned all different types of accounts? IIRC, FDIC coverage is $250k per type of account, per depositor, per institution. If the accounts are all at one bank as in the scenario you describe, you should be covered to the $1mil total assuming none of the accounts are identical, eg 2 of the three aren't both savings accounts. If you're over $250k per person in one type of account at this bank, you'll have to split any assets over $250k between multiple institutions if you want to be insured for the full amount.
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Abe
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Re: Question about FDIC insurance

Post by Abe »

BigMoneyNoWhammies wrote: Thu Oct 08, 2020 2:15 pm Are the accounts you mentioned all different types of accounts? IIRC, FDIC coverage is $250k per type of account, per depositor, per institution. If the accounts are all at one bank as in the scenario you describe, you should be covered to the $1mil total assuming none of the accounts are identical, eg 2 of the three aren't both savings accounts. If you're over $250k per person in one type of account at this bank, you'll have to split any assets over $250k between multiple institutions if you want to be insured for the full amount.
OK, there would be 3 accounts at same bank.
One account, CD jointly held by my wife and myself for $500k.
One account, CD held by myself as owner with my wife as beneficiary, $250k
One account, CD held by my wife as owner with me as beneficiary, $250k
Total for the three accounts would be 1 million.
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kaneohe
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Re: Question about FDIC insurance

Post by kaneohe »

Abe wrote: Thu Oct 08, 2020 2:35 pm
BigMoneyNoWhammies wrote: Thu Oct 08, 2020 2:15 pm Are the accounts you mentioned all different types of accounts? IIRC, FDIC coverage is $250k per type of account, per depositor, per institution. 2 If the accounts are all at one bank as in the scenario you describe, you should be covered to the $1mil total assuming none of the accounts are identical, eg 2 of the three aren't both savings accounts. If you're over $250k per person in one type of account at this bank, you'll have to split any assets over $250k between multiple institutions if you want to be insured for the full amount.
OK, there would be 3 accounts at same bank.
One account, CD jointly held by my wife and myself for $500k.
One account, CD held by myself as owner with my wife as beneficiary, $250k
One account, CD held by my wife as owner with me as beneficiary, $250k
Total for the three accounts would be 1 million.
EDIE gave me the same answer.......that you're covered for 500/250/250=1M even tho all 3 are savings accounts.
hudson
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Re: Question about FDIC insurance

Post by hudson »

https://edie.fdic.gov/

I ran the same report using a local FDIC bank because I didn't think that the $500K with 2 beneficiaries was covered. I was wrong it was covered. The entire $1 M looks good.
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cruzbay
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Re: Question about FDIC insurance

Post by cruzbay »

Because it is 3 different categories, your $1million is insured. One important thing to remember is that while you are fully insured, the interest you earn is not because it takes you over the limit. If you want this money to be insured, you could subtract your anticipated interest earnings and invest that amount. Once the interest is earned, it will take your account to the max insurance for your mix of accounts.
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Abe
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Re: Question about FDIC insurance

Post by Abe »

Thank everyone for replying to my question. I called FDIC and they also told me on the phone that I would be covered for 1 million, so looks like I'm good to go. Thanks again
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MikeG62
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Re: Question about FDIC insurance

Post by MikeG62 »

Abe wrote: Thu Oct 08, 2020 5:51 pm Thank everyone for replying to my question. I called FDIC and they also told me on the phone that I would be covered for 1 million, so looks like I'm good to go. Thanks again
You are good to go - fully insured.

If you have more to invest, you can open a POD account (assuming they allow POD accounts) and increase the insurance coverage even further. This assumes you have beneficiaries you can name. POD accounts are considered another separate account for insurance purposes much like an individual account owned by a joint owner of a joint account is a separate account.

If you can get into Barksdale Federal Credit Union, you can do a lot better than 1.0% too. If you are eligible for membership, you should consider their plus point 5-year ladder. I opened two of those ladders in August. Very smooth and easy.
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Abe
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Re: Question about FDIC insurance

Post by Abe »

MikeG62 wrote: Fri Oct 09, 2020 8:59 am
Abe wrote: Thu Oct 08, 2020 5:51 pm Thank everyone for replying to my question. I called FDIC and they also told me on the phone that I would be covered for 1 million, so looks like I'm good to go. Thanks again
You are good to go - fully insured.

If you have more to invest, you can open a POD account (assuming they allow POD accounts) and increase the insurance coverage even further. This assumes you have beneficiaries you can name. POD accounts are considered another separate account for insurance purposes much like an individual account owned by a joint owner of a joint account is a separate account.

If you can get into Barksdale Federal Credit Union, you can do a lot better than 1.0% too. If you are eligible for membership, you should consider their plus point 5-year ladder. I opened two of those ladders in August. Very smooth and easy.
Thanks MikeG62. Actually I have 2 local banks offering the 1 year CD @ 1%. I'm planning on putting 1 million in each bank, but I will check out Barksdale Credit Union.
Slow and steady wins the race.
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