Transcripts

"Money File"-The FDIC Rules

SUSIE GHARIB: In the money file tonight, making sure your bank deposits are covered by FDIC insurance. Here's Eric Schurenberg, managing editor at "Money" magazine.

ERIC SCHURENBERG, "MONEY" MAGAZINE: Three banks failed last month and some 90 more are on regulators' troubled list. But you're not worried because you know your deposits are insured by the FDIC. Well, yes they are, but remember that protection is good only if you obey all the FDIC's rules. Here's how to make sure you are doing that. Start by asking the FDIC itself. In general, you're good if you have less than $100,000 in any one bank and up to 200 grand in joint accounts. Some retirement accounts may be covered up to 250 grand. But just to be sure, go to the FDIC's web site, fdic.gov and plug in information into its calculator, the electronic deposit insurance estimator. If that exercise informs you that some of your money lacks insurance, the first step is to try changing your accounts' ownership status. For example, by titling one account in your name, one in your spouse's name and one jointly, you can insure as much as 400,000 bucks. Or you can spread your money among banks and insure an unlimited total amount, as long as you keep under the limits for each institution. If you have so much in the bank that this seems like a lot of trouble, check out the certificate of deposit account registry service, known by its acronym CDARS. It lets you keep up to $50 million in CDs with one home bank. That bank then parcels out your holdings among other banks, so that you stay fully insured. Interest rates may be a tad lower than you could get on your own, but that's a lot of peace of mind for a lot of wealth. I'm Eric Schurenberg.