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Federal Deposit Insurance Corp. insurance coverage is particularly relevant now, in light of the 2023 banking crisis involving the failures of several institutions: Silicon Valley Bank, Signature Bank and First Republic Bank. The FDIC insures up to $250,000 per depositor, per institution and per ownership category at member banks. But what can you do if you've got more than $250,000 in the bank? Here are eight solutions for insuring all your money.
» Read about bank runs, what happens when a bank fails and what to do when there's a bank-run panic
1. Open an account at a different bank
Perhaps the most straightforward way to get another $250,000 insured is to open an account at a second FDIC member bank. If you're using accounts that earn interest at a bank with only FDIC insurance, be sure your deposits are low enough that your balance with interest will be within the $250,000 limit. Once an account reaches the $250,000 limit, you can open another new account at another institution.
» MORE: Should I keep accounts open at multiple banks?
2. Add a joint owner
Single, individually owned accounts are insured up to $250,000 total at FDIC member banks. However, joint accounts — with two or more owners — are insured up to $500,000 total. So to double the insured amount in deposit accounts at a single bank, you can add another owner.
» Considering a co-owner? Find out how and when joint bank accounts work
3. Get an account that's in a different ownership category
FDIC insurance coverage applies to several ownership categories:
Single accounts (owned by one person).
Joint accounts (owned by more than one person).
Revocable trust accounts.
Irrevocable trust accounts.
Corporation, partnership and unincorporated association accounts.
Employee benefit plan accounts.
Government accounts.
The ownership category refers to who owns the account — such as a single or joint account — and the account type. So, for example, you could still safely have up to $250,000 total across checking, certificates of deposit, savings, and money market accounts in a "single account" ownership category and put another $250,000 in a qualifying individual retirement account, which falls under the ownership category of "certain retirement accounts."
» Need more details? Learn about FDIC insurance ownership categories
4. Join a credit union
Similar to the FDIC, the National Credit Union Share Insurance Fund insures up to $250,000 per person, per institution, per ownership category at credit unions that have National Credit Union Administration membership. Any credit union offering this coverage must show that it's insured in its advertising and display the official NCUSIF sign at its branches. To open an account at a credit union, you need to be a member. Credit unions sometimes limit membership by region or employers, but some of the best credit unions have easier qualifications to join.
5. Use IntraFi Network Deposits
The IntraFi Network Deposits program allows you to get FDIC insurance on millions of dollars through a network of financial institutions without having to open accounts at multiple banks. Instead, you can keep all your money at one bank, and as long as that bank is part of the IntraFi Network, the program will funnel your money into deposit accounts of your choice at other network banks.
6. Open a cash management account
A cash management account is an account that has features similar to checking, savings and/or investment accounts. Depending on the CMA, your account may offer a debit card, check writing abilities and earn interest, among other benefits. Nonbank financial service providers tend to offer CMAs, but the FDIC insures the cash balance of a CMA, with some institutions offering coverage for up to $2 million total. They're able to do this as members of the IntraFi Network Deposits program.
» Ready to open one of these hybrid accounts? See our list of the best cash management accounts
7. Put your money in a MaxSafe account
A MaxSafe account maximizes FDIC insurance coverage by offering protection for balances of $250,000 up to $3.75 million total per person. Wintrust, the company that offers MaxSafe accounts, provides this level of protection by distributing deposits across more than a dozen community bank charters, similar to how the IntraFi Network works. MaxSafe accounts include CDs, money market accounts and IRAs.
8. Opt for an account with both FDIC and DIF insurance
The Depositors Insurance Fund, or DIF, is a private insurance fund that insures deposit amounts at member banks beyond what the FDIC covers — without a limit. About 70 banks offer DIF coverage, and all are based in Massachusetts.
FDIC insurance has limitations, but you have several options to insure a greater amount.
FAQs
How to Insure Bank Deposits Over $250,000
- Open an Account at a Different Bank. FDIC coverage limits are per bank. ...
- Add a Joint Account Owner. ...
- Split Funds Between Ownership Categories. ...
- Use a Network Bank.
Millionaires can insure their money by depositing funds in FDIC-insured accounts, NCUA-insured accounts, through IntraFi Network Deposits, or through cash management accounts. They may also allocate some of their cash to low-risk investments, such as Treasury securities or government bonds.
Is it safe to have more than $250000 in a bank account? ›
An account that contains more than $250,000 at one bank, or multiple accounts with the same owner or owners, is insured only up to $250,000. The protection does not come from taxes or congressional funding. Instead, banks pay into the insurance system, and the insurance provides their customers with protection.
How do I insure a large bank deposit? ›
Individual Account Owners have several options to protect deposit balances:
- Open Accounts at Multiple Banks. ...
- Open Accounts with Different Owners. ...
- Open Accounts with Trust/POD [pay-on-death] Designations. ...
- Open a CD Account, or Money Market Account, with a bank that offers IntraFi (formerly CDARs) services.
As long as the financial institution is insured by the FDIC or NCUA, the money you put into a deposit account at a bank or credit union is insured for up to $250,000 per depositor, per bank. If the bank collapses or fails, you can still get your money back within a few days of the bank's closure.
What is the best bank for large amounts of money? ›
Bank of America, Citibank, and HSBC, among others, have created accounts that come with special perquisites for the ultrarich, such as personal bankers, waived fees, and the option of placing trades. The ultrarich are considered to be those with more than $30 million in assets.
Where do millionaires keep their money in banks? ›
Millionaires also have zero-balance accounts with private banks. They leave their money in cash and cash equivalents and they write checks on their zero-balance account. At the end of the business day, the private bank, as custodian of their various accounts, sells off enough liquid assets to settle up for that day.
Where do millionaires hide their money? ›
Secret Swiss bank accounts or shell companies in the Cayman Islands sound like the stuff of heist movies, but some wealthy people do use foreign accounts to shield their money from the IRS's irises. - These tax havens are attractive places to stash cash and maybe not tell the US government that it's there.
Does the FDIC insure $250000 in multiple accounts? ›
The standard deposit insurance coverage limit is $250,000 per depositor, per FDIC-insured bank, per ownership category. Deposits held in different ownership categories are separately insured, up to at least $250,000, even if held at the same bank.
Can banks seize your money if the economy fails? ›
Your money is safe in a bank, even during an economic decline like a recession. Up to $250,000 per depositor, per account ownership category, is protected by the FDIC or NCUA at a federally insured financial institution. What happens if my bank fails during a recession?
How much is too much cash in savings? An amount exceeding $250,000 could be considered too much cash to have in a savings account. That's because $250,000 is the limit for standard deposit insurance coverage per depositor, per FDIC-insured bank, per ownership category.
What is the best way to deposit a large sum of money? ›
To safely deposit a large amount of cash, visit a brick-and-mortar branch operated by your financial institution. Contact your financial institution if you plan to make a sizable deposit, said Christopher Naghibi, executive vice president and chief operating officer at First Foundation Bank.
How to protect deposits over 250k? ›
Here are four ways you may be able to insure more than $250,000 in deposits:
- Open accounts at more than one institution. This strategy works as long as the two institutions are distinct. ...
- Open accounts in different ownership categories. ...
- Use a network. ...
- Open a brokerage deposit account.
The FDIC insures deposit accounts up to $250,000 per depositor, per FDIC-insured bank and per ownership category. This includes savings and checking accounts as well as money market accounts and CDs.
What bank has the highest FDIC-insured? ›
Wealthfront has increased the Federal Deposit Insurance Corporation (FDIC) coverage for its Cash Account up to $8 million for individual accounts and $16 million for joint accounts. In the unlikely event that Wealthfront fails, your money is protected up to 32 times more than the usual $250,000 insured by the FDIC.
How much do banks insure your money? ›
The FDIC provides deposit insurance to protect your money in the event of a bank failure. Your deposits are automatically insured to at least $250,000 at each FDIC-insured bank.
How to keep large amounts of money safe? ›
Separate and store cash funds in different places, preferably 2 safes. Invest in a quality, professional-grade, technologically advanced at-home safe. Consider your need for a water-resistant or fireproof safe. Make sure anyone who might need to access an emergency fund of cash can.
Does adding beneficiaries to bank account increase FDIC coverage? ›
NOTE ON BENEFICIARIES: WHILE SOME SELF-DIRECTED RETIREMENT ACCOUNTS, LIKE IRAS, PERMIT THE OWNER TO NAME ONE OR MORE BENEFICIARIES, THE EXISTENCE OF BENEFICIARIES DOES NOT INCREASE THE AVAILABLE INSURANCE COVERAGE.
