You Get a Large Windfall: How Can It All Be FDIC-Insured?

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FDIC Consumer News – Spring 2006 – How Can It All Be FDIC-Insured?


Related Consumer Finance Programs - The following sub-directories of companies offer a wide variety of financial programs to assist you with the management of your finances. Consolidate debt with a consolidation loan or use a debt counseling service or mortgage refinance for help with the consolidation of your charge card debt and other monthly payments.

  • Personal Loan Companies - Need a smaller loan for the consolidation of your credit cards? Personal loan credit is typically unsecured and does not require you to provide security in the form of your assets, such as your car or other personal assets.
  • Debt Settlement Negotiation - Are you finding yourself unable to meet your monthly budget because of too many credit card payments? Negotiating your debts may or may not be the right choice to get help with your financial situation. Compare programs designed for helping people with similar debt problems.
  • Credit Debt Consolidation - Need lower payments? If you have a large amount of small debts (especially if they have adjustable interest rates), now may be a good time to do a consolidation of your bills and lower your overall monthly outgo.

FDIC Insurance: Do You Know As Much As You Think You Know?

You Get a Large Windfall: How Can It All Be FDIC-Insured?


The FDIC frequently gets inquiries from people who, because of a recent development (perhaps an inheritance, a home sale, or a big payment from a pension or insurance claim) have a large sum of money they want to have fully protected by FDIC insurance. "They are often surprised to learn there are ways they can deposit much more than $100,000 at one bank and have all of it insured by the FDIC," said Kathleen Nagle, chief of the agency's Deposit Insurance Section.


In general, to maximize your FDIC insurance coverage at one bank, you can deposit funds in different "ownership categories" (such as single accounts, joint accounts and certain trust accounts). Because each category is separately insured, that enables you to go beyond the basic deposit insurance coverage of $100,000. Also, payable-on-death accounts (which state who will get the funds upon your death) may get extra coverage based on how many qualified family members are named as beneficiaries (see misconception number 8).


However, before structuring accounts just to maximize insurance coverage, the FDIC has some warnings. "First, remember that if you add someone as a co-owner to an account just to maximize your insurance coverage, this other person will have as much right to withdraw the money as you do," Nagle said. "Second, only name beneficiaries to a payable-on-death account if you truly want that person to get the money if you die. Third, make sure you meet any FDIC requirements for obtaining coverage in the different ownership categories."


Spring 2006 Main Menu


FDIC Consumer News is published by the Federal Deposit Insurance Corporation


FDIC Consumer News is produced quarterly by the FDIC Office of Public Affairs in cooperation with other Divisions and Offices. It is intended to present information in a nontechnical way and is not intended to be a legal interpretation of FDIC or other government regulations and policies. Mention of a product, service or company does not constitute an endorsement.


Find current and past issues of FDIC Consumer News at http://www.fdic.gov/consumernews. Refer to this same index to locate the issues that are specially formatted for being reprinted in any quantity.


To receive an e-mail notice about each new issue of FDIC Consumer News posted on the FDIC Web site, with links to stories, follow instructions posted at www.fdic.gov/about/subscriptions/index.html.


Last updated on 5/09/2006

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Make the correct decisions when shopping for banking, debt consolidation and related financial services. Educate yourself!

The Debt Consolidation Loan Directory has a growing library of free informative / educational financial resources for consumers shopping for many types of services related to the management of your money, such as consolidating credit card debts, fraud alerts and car insurance. There is no better way to make decisions regarding the management of your personal finances than to read and understand how they work. Please feel free to visit our consumer resource library for more information.

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