Name:   GoneFishin - Subject:   FDIC Insurance Date:   3/20/2023 10:51:55 AM

You often read that FDIC deposit insurance at a bank or credit union provides coverage up to $250,000 per person so that a joint account would be $500,000. The fact is it is $250,000 per person per type of account.

As an example, let’s assume there is Mary Smith and John Smith husband and wife. They have 2 children Bill and Amy. They have a joint account Mary and John Smith. The insurance is $500,000.

Mary has an individual account Mary Smith. That is a different type of account so Mary has $250,000 insurance.

John has an individual account John Smith. That is a different type of account so John has $250,000 insurance.

They are covered for a total of $1,000,000.

In addition, a little known fact is that beneficiaries named on an account can raise the amount of insurance even higher.

They could established the joint account with 2 beneficiaries…Bill and Amy. They would have to set up the account up as a POD or Payable on Demand. Basically, this means if Mary and John both die the account passes to the beneficiaries without going thru probate.

Rather than have 3 accounts, let’s assume the $1,000,000 was in a joint account..Mary and John Smith with 2 beneficiaries Bill and Amy. The insurance would be $500,000 since it is a joint account plus $250,000 for each beneficiary for another $500,000 for a total of $1,000,000.

I am not a banker, attorney, or accountant.