How FDIC Insurance Works
The FDIC, an independent federal agency, protects the money you deposit in checking, savings, money market, CD, and retirement accounts at insured banks like River Bank & Trust. FDIC insurance is backed by the U.S. government—according to the FDIC, no depositor has lost a penny of insured funds since the agency’s founding in 1933. FDIC coverage starts automatically as soon as you open your account.
Understanding FDIC Insurance Coverage
The standard insurance amount is $250,000 per depositor, per insured bank, for each ownership category. This means that by having accounts in different ownership categories, like single accounts and joint accounts, you can get more than $250,000 in coverage. You can calculate your current coverage amount using the FDIC’s FDIC: Electronic Deposit Insurance Estimator (EDIE).
If your balance is higher than your current FDIC insurance coverage amount, consider these strategies to maximize your coverage:
If you and your spouse or partner each have a single account insured up to $250,000, together, you’ll have a total of $500,000 coverage.
Joint accounts are insured separately from accounts in other ownership categories, up to a total of $250,000 per owner. This means you and your spouse can get another $500,000 of FDIC insurance coverage by opening a joint account in addition to your single accounts. And adding another joint account owner—like a parent—adds another $250,000 in coverage, and so on.
You may be able to get an additional $250,000 of coverage for your family by opening a custodial account (also known as a Uniform Transfers to Minors Act or Uniform Gift to Minors Act account) in a minor’s name. For insurance purposes, the FDIC treats these as single accounts owned by the minor.
In addition to helping you plan for your future, a retirement account can help you increase your FDIC insurance coverage—retirement accounts are insured up to $250,000.
You can increase your FDIC insurance coverage by creating a payable-on-death account (also known as an informal trust, in-trust-for, or Totten Trust account) or titling an account in the name of a formal revocable trust. For these account types, each unique beneficiary adds $250,000 of coverage up to FDIC limits. For example, a payable-on-death account with 1 owner and 5 beneficiaries could be insured up to $1,250,000.
Keep in Mind
This is for informational purposes only. We don’t give legal, tax, investment, or financial advice. If you have questions about FDIC insurance, consult a financial professional or check out the FDIC’s educational materials.