Information on FDIC Insurance on Checking Accounts

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The acronym FDIC stands for "Federal Deposit Insurance Corporation." Get information on FDIC insurance on checking accounts with help from a personal finance professional in this free video clip.

Part of the Video Series: Money Management
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Video Transcript

Hi, my name is Andrew Schrage, co-owner of the MoneyCrashers.com personal finance website, and today we're going to discuss FDIC insurance on your checking accounts. The Federal Deposit Insurance Corporation was actually created back in 1933, and only covered $2,500 of your checking deposits on insurance. Fortunately, this amount has gone up drastically, and the FDIC now covers $250,000 on each of your bank checking accounts with a single bank. In other words, if you you have $250,000 at say bank A, and that bank goes bankrupt or goes under, you are guaranteed to receive that money back. Of course if you have more than that $250,000, then you may be liable for a loss. What I suggest, if you have more than $250,000 that you want to put in checking accounts, is to allocate them between a few different banks. So let's say you have $500,000. You can put $250,000 in bank A, $250,000 in bank B, and even if both banks go under, go bankrupt, you'll still get that full amount back. So you do wanna be strategic about how you allocate your checking deposits. Once again, this is Andrew Schrage, co-owner of MoneyCrashers.com, discussing FDIC insurance on your checking accounts.

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