Is Your Money Safe?
14 July 2008The recent failure of five FDIC insured banks, the largest and most recent being IndyMac Bank, and the concern that other banks may soon fail amid the banking crisis that we’re experiencing brings into question again the safety of your savings.
Here are some top facts regarding FDIC insured deposits, in the case that your bank fails:
1. If you deposited your funds via a broker to a bank which is in trouble, you must work with your broker to answer any questions. Once the FDIC receives a balanced investor file and required documents from your broker, your insured funds will be wired to your broker.
2. If you have deposited funds in excess of the FDIC insured maximum of $100,000 the FDIC will send out a Receiver Certificate to you, which entitles you to proportionately share in funds recovered through the liquidation of bank assets. In addition the FDIC will pay you an advance of 50% of your uninsured deposit. In these times, saving funds in excess of $100,000 in a bank may bring with it some risk. It may be a prudent strategy to break your savings up into units which do not exceed $100,000 and place them with several institutions who are FDIC insured.
No comments yet