Can you please tell me how much FDIC insurance this scenario has?

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GrayS26
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Can you please tell me how much FDIC insurance this scenario has?

Post by GrayS26 » Wed Oct 17, 2018 12:41 pm

Single 1 owner Checking

Single 1 owner Savings

Several CDs, single 1 owner

But ALL accounts have the SAME 2 beneficiaries.

How much FDIC coverage is for this scenario?

Thanks

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DaftInvestor
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by DaftInvestor » Wed Oct 17, 2018 12:45 pm

Not enough info.
Are all the above the same bank or different banks?
Are all the "1 owner" 's the same owner?

My understanding:
If same bank - total of $250K PER OWNER (so if by "1 owner" above you mean the same owner you get $250K).
If different banks its $250K * #-of-banks * #-of-owners

https://www.fdic.gov/deposit/deposits/faq.html

Retired2013
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by Retired2013 » Wed Oct 17, 2018 12:48 pm

https://www5.fdic.gov/edie/

FDIC website to calculate.

wolf359
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by wolf359 » Wed Oct 17, 2018 12:51 pm

GrayS26 wrote:
Wed Oct 17, 2018 12:41 pm
Single 1 owner Checking

Single 1 owner Savings

Several CDs, single 1 owner

But ALL accounts have the SAME 2 beneficiaries.

How much FDIC coverage is for this scenario?

Thanks
It depends. FDIC coverage is per institution, per owner, per deposit category. If all the accounts are under a single owner's name, at a single institution, then $250,000 for each deposit category (as defined here https://www.fdic.gov/deposit/covered/categories.html). For example, if you have a deposit account and a retirement account at the same bank, each of those categories has a separate limit.

This is a tool that could be used for your specific question: https://www5.fdic.gov/edie/

You could maximize the coverage by putting each CD and each account at a different institution. In that case, it would be $250,000 per account per institution.

GrayS26
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by GrayS26 » Wed Oct 17, 2018 1:14 pm

Same bank. 1 owner of all the accounts (savings, checking, and several CDs)

But the same 2 beneficiaries for all accounts.

So I’m trying to understand what the limit would be

Thanks

libralibra
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by libralibra » Wed Oct 17, 2018 1:26 pm

500k (1 owner x 2 beneficiaries x 250k)

jalbert
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by jalbert » Wed Oct 17, 2018 1:35 pm

libralibra wrote:
Wed Oct 17, 2018 1:26 pm
500k (1 owner x 2 beneficiaries x 250k)
I think it would be $750K. 1 owner plus 2 beneficiaries = 3 people with beneficial interest and insurance at $250K ea.
Risk is not a guarantor of return.

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dm200
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Location: Washington DC area

Re: Can you please tell me how much FDIC insurance this scenario has?

Post by dm200 » Wed Oct 17, 2018 1:36 pm

Retired2013 wrote:
Wed Oct 17, 2018 12:48 pm
https://www5.fdic.gov/edie/

FDIC website to calculate.
Yes..

Tamales
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by Tamales » Wed Oct 17, 2018 1:37 pm

To be clear, you are not counting the owner as a beneficiary, right? The 2 beneficiaries are 2 completely different individuals?

Here's an older thread with various scenarios/examples

viewtopic.php?f=2&t=176529&p=2669609

GrayS26
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by GrayS26 » Wed Oct 17, 2018 1:42 pm

The owner is just a single owner

Then, they added 2 different beneficiaries

Example:

John is the single account owner of a Checking, Savings, and several CDs, at one FDIC insured bank.

John put Sally and Bob as beneficiaries on his Checking, Savings, and all is his CDs.

What would the FDIC insurance be?

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GoldStar
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by GoldStar » Wed Oct 17, 2018 1:56 pm

GrayS26 wrote:
Wed Oct 17, 2018 1:42 pm
The owner is just a single owner

Then, they added 2 different beneficiaries

Example:

John is the single account owner of a Checking, Savings, and several CDs, at one FDIC insured bank.

John put Sally and Bob as beneficiaries on his Checking, Savings, and all is his CDs.

What would the FDIC insurance be?
My understanding is that unless the "owner" is a trust - the beneficiaries have no bearing on anything. (Read the FAQ provided above).
So in this example, FDIC insurance limit is $250,000 since there is only one owner and all accounts are at one bank (beneficiaries are irrelevant).

Retired2013
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by Retired2013 » Wed Oct 17, 2018 2:14 pm

I put in $750,000; one owner (Smith1) and two beneficiaries (Ben1 & Ben2). The results are below. $500k insured, $250k uninsured.



Bank Name: chase Number of Accounts: 1
Checkmark

ATTENTION: EDIE estimates that some of your money in this financial institution exceeds FDIC limits and is currently uninsured. It is important to be familiar with your FDIC coverage limits -- you should use EDIE every time you make changes to your accounts to make sure your deposits are always fully insured.

Revocable Trust Accounts
Account Nickname Balance Owner(s) Beneficiaries

Edit Delete ben1 $750,000.00 Smith1 Ben1
Ben2
Insurance Summary Balance Insured Uninsured
Smith1 POD/ITF
Ben1, Ben2
$750,000.00 $500,000.00 $250,000.00
Total for all accounts at chase (Totals will be rounded)
Balance Insured Uninsured
$750,000.00 $500,000.00 $250,000.00

If you’d like to learn more about what you can do to protect your deposits please visit www.FDIC.gov/deposit/deposits or contact the FDIC at 1-877-275-3342.
This calculation assumes that all of the above accounts are on deposit in an FDIC-insured bank, and that the account owners do not have accounts other than those listed above at chase.
Report generated on: October 17, 2018

Tamales
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by Tamales » Wed Oct 17, 2018 3:12 pm

I believe in FDIC lingo, a PoD beneficiary is considered a trust.
So I think $500k would be the insurance limit with 2 separate individuals as POD beneficiaries.

jalbert
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Re: Can you please tell me how much FDIC insurance this scenario has?

Post by jalbert » Wed Oct 17, 2018 3:48 pm

GoldStar wrote:
Wed Oct 17, 2018 1:56 pm
GrayS26 wrote:
Wed Oct 17, 2018 1:42 pm
The owner is just a single owner

Then, they added 2 different beneficiaries

Example:

John is the single account owner of a Checking, Savings, and several CDs, at one FDIC insured bank.

John put Sally and Bob as beneficiaries on his Checking, Savings, and all is his CDs.

What would the FDIC insurance be?
My understanding is that unless the "owner" is a trust - the beneficiaries have no bearing on anything. (Read the FAQ provided above).
So in this example, FDIC insurance limit is $250,000 since there is only one owner and all accounts are at one bank (beneficiaries are irrelevant).
My understanding is that when payable-on-death beneficiaries are added to a regular taxable bank account, the account becomes a Totten trust:

https://en.m.wikipedia.org/wiki/Totten_trust

These are informal structures so no trust documents are needed, and most account owners just see that they declared payable-on-death beneficiaries.

Thus, I believe that the revocable trust rules for FDIC insurance apply. The account owner and declared payable-on-death beneficiaries are all beneficiaries of the implied Totten trust.

The financial institution should be able to confirm the level of FDIC insurance that applies. A phone call to the FDIC would be another way to confirm.
Risk is not a guarantor of return.

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