can I spread my $$ in different banks, will the FDIC still cover over 100k?

Question

I just sold my house got 350k cash, FDIC secures only 100 max, if I spread my money in different banks will that be ok, the FDIC will cover my 350k?

Answer 1

The simple answer is yes.

The FDIC covers $100K in deposit accounts per insured bank. If you deposit $100K in three different insured banks, you will have $300K worth of insurance on your funds.

In reality, you may qualify for more than $100K in FDIC insurance at the same bank. I don't quite understand all the details, but feel free to read it yourself:

http://www.fdic.gov/deposit/deposits/insuringdeposits/index.html

The FDIC has "ownership catagories". Certrain ownership catagories are insured for more than $100K. If you and a spounse have a joint account at the same bank, each person is allotted $100K in insurance for a total of $200K. Like I said, read the web page for yourself and see what ownership catagories apply to you so you can act accordingly.

Answer 2

The insurance is by account type. If two accounts in one bank are the same account type, you have just the 100k total. But, if you have one single and one joint account, each account will have 100k coverage. In addition, if you have a guardian account for a child, it will also have its own 100k protection. Trusts, and some other types also come to mind. I am not sure if a 401k savings is considered as a different type than a standard savings account. When in doubt, call the bank manager and ask. They will know the FDIC regulations pretty well. If you really want to keep money in excess of the FDIC coverage, you may be able to purchase deposit insurance in excess of FDIC limits. This will be done through your financial institution's insurance carrier, not through your own. Again, you would need to contact bank manager to get the ball rolling on that. Some banks do not offer this excess coverage because of the extra effort involved as the policy is usually reviewed every six months. Good Luck!

Answer 3

The FDIC does not care what you have at other financial institutions. Generally, you are insured up to $100K per ownership category (IRA's are at $250K) at each financial institution. Insurance is not based on the number of accounts you have, rather it is based on HOW they are owned.

Depending on how you own your bank accounts, you can have MORE than $100K coverage, all at the same financial institution.

You should check out the FDIC website or talk to your banker. Don't ask a teller, talk to the teller supervisor.

Good luck!

Answer 4

Check with a brokerage house like Smith Barney, they can spread your $$ among several banks to maintain FDIC insurance while having just one account. Also, the rates are typically higher than banks as well. You may get more advice than you are looking for, but no one can make you do anything with YOUR money.

Answer 5

Yes, the FDIC cover per depositor per bank. Unless our entire banking system fails along with the Federal Reserve, you will get full coverage up to 100k per bank. If you divide your money into 4 banks, you'll be okay. Congrats mate.

Answer 6

The FDIC covers on a "per depositor" basis. If you have the money in four different banks and they all fail at once, you're going to get only 100k.

Answer 7

yes it will cover it. However, I though FDIC increased the insured limit ? Check with bank. You may also have different accounts within the same bank and be covered. Check with your banker.

Answer 8

Yes, but for what? FDIC is currently bankrupt. The SIPC, found with a brokerage firm, would be a far safer place, and your returns would be greater as well. If you plan to roll the proceeds back into a new home, I wouldn't worry about it. If not, find a good independent financial planner. Banks are not the place to put that kind of money.

Answer 9

More than you ever wanted to know ....
-MM