Most savings accounts are insured up to $250,000 per depositor, per bank
The Federal Deposit Insurance Corporation (FDIC) insures savings accounts at member banks. If your bank fails, the FDIC pays you back up to $250,000 in that account. This limit applies per person, per bank — so if you have $250,000 in savings at Bank A and $250,000 at Bank B, both are fully covered.
The $250,000 limit has been in place since 2010. It covers the balance in your account plus any interest earned up to the moment the bank closes. Money market accounts and NOW accounts (negotiable order of withdrawal accounts) are also covered under this same limit.
You do not need to do anything to set up this coverage. If your bank is an FDIC member, your account is automatically insured from the moment you open it. Most banks display the FDIC logo on their website or in their lobby, but you can verify membership by searching the FDIC's Bank Find tool on their website.
Key Takeaways
- The FDIC insures savings accounts up to $250,000 per depositor at each bank where you have an account.
- Coverage is automatic at FDIC member banks and includes interest earned on the account.
- If you have more than $250,000 at one bank, the amount over the limit is not covered by FDIC insurance.
- Joint accounts, retirement accounts, and trust accounts have separate insurance limits, so you may be able to protect more than $250,000 at a single bank by using different account structures.
- The FDIC has paid out claims in full every time a member bank has failed since the agency was created in 1933.
What is not covered by FDIC insurance
FDIC insurance covers the money in your account, but not investments held at the bank. If you buy stocks, bonds, mutual funds, or brokerage products through your bank, those are not FDIC-insured. They may be protected under a different system called SIPC (Securities Investor Protection Corporation), but that is a separate coverage with its own limits and rules.
Safe deposit boxes are also not covered. If you keep jewelry, documents, or other valuables in a safe deposit box at your bank, the FDIC does not insure them. The bank itself may carry insurance, but you should verify what protection exists before storing anything valuable.
Cryptocurrency, prepaid cards, and money orders held by the bank are not covered either. If your bank offers these products, treat them as separate from your insured deposit account.
How the $250,000 limit works across multiple accounts at one bank
If you have more than one account at the same bank, the FDIC adds them together for insurance purposes. A savings account and a checking account at the same bank share the same $250,000 limit. If your savings account holds $180,000 and your checking account holds $100,000 at Bank A, only $250,000 total is covered — the remaining $30,000 is uninsured.
However, certain account types have separate limits. A joint account (held with another person) has its own $250,000 limit. A retirement account (IRA) has its own $250,000 limit. A trust account has its own $250,000 limit. This means you can hold up to $250,000 in a joint savings account, $250,000 in your individual IRA, and $250,000 in an individual savings account at the same bank, and all three would be fully covered.
The FDIC publishes a detailed breakdown of which account types have separate coverage. If you hold more than $250,000 at one bank, review the FDIC's coverage categories to see whether splitting your money into different account structures would protect more of it.
What happens when a bank fails
When an FDIC member bank fails, the FDIC takes over and arranges for another bank to assume the deposits, or it pays depositors directly. In most cases, you regain access to your money within a few business days. The FDIC does not mail checks; instead, it transfers your insured balance to a new account at another bank or restores access through the failed bank's systems.
You will receive a notice from the FDIC or the acquiring bank telling you what happened and how to access your money. If your account balance exceeded $250,000, you will be notified separately about the uninsured portion. The FDIC maintains a claims process for uninsured amounts, though recovery is not may provide and may take months or years.
Bank failures are rare. The FDIC has handled the closure of member banks, but the last significant wave occurred during the 2008 financial crisis. Since then, the banking system has been more stable, though failures can still occur.
Accounts with separate FDIC coverage limits
| Account Type | Coverage Limit | Notes |
|---|---|---|
| Individual savings or checking | $250,000 | Combined limit across all individual accounts at one bank |
| Joint account | $250,000 | Per joint account; separate from individual accounts |
| IRA or Keogh retirement account | $250,000 | Separate limit per retirement account type |
| Trust account | $250,000 per beneficiary | A trust naming three beneficiaries can hold up to $750,000 covered |
| Custodial account (for a minor) | $250,000 | Separate from the custodian's own accounts |
How to verify your bank is FDIC-insured
Search the FDIC's Bank Find tool on the FDIC website by entering your bank's name or location. The tool shows whether the bank is a member, which FDIC region it belongs to, and the date it joined. If your bank does not appear in the search, it is not FDIC-insured.
Most traditional banks and many credit unions are FDIC members. Online banks are also covered if they are FDIC members — check their website or contact customer service to confirm. Some online banks partner with multiple FDIC member banks to spread deposits across institutions, which allows them to offer coverage above $250,000 per customer.
If you bank at a credit union instead of a bank, your account is likely insured by the National Credit Union Administration (NCUA), which operates under similar rules with the same $250,000 limit. Verify your credit union's NCUA membership using the NCUA's credit union locator.
Protecting more than $250,000 at one bank
If you have more than $250,000 to deposit, you have several options. You can open accounts at different FDIC member banks — each bank's $250,000 limit is separate. You can also use different account structures at the same bank: a joint account, a retirement account, and a trust account each have their own $250,000 coverage.
Some online banks use a service called CDARS (Certificate of Deposit Account Registry Service) or ICS (Insured Cash Sweep) to automatically spread your deposit across multiple FDIC member banks behind the scenes. This allows you to deposit a large sum and receive coverage above $250,000 while maintaining a single account relationship. Ask your bank whether it offers this service.
Money market funds and other investments are not FDIC-insured, so they are not a solution for protecting large cash balances. If you need to hold cash above the FDIC limit and do not want to split it across banks, you are accepting uninsured risk.
Frequently Asked Questions
If I have $300,000 in a savings account at one bank, how much is covered?
The FDIC covers $250,000. The remaining $50,000 is uninsured. If the bank fails, you would receive $250,000 and would need to file a claim for the uninsured portion, which may not be recovered in full.
Does FDIC insurance cover my money if I transfer it to another bank?
Yes. Each bank's $250,000 limit is separate. If you move $200,000 from Bank A to Bank B, both amounts are covered — $200,000 at Bank A and $200,000 at Bank B, assuming you have no other accounts at either bank.
What if my bank is not FDIC-insured?
Your deposits are not protected by federal insurance. If the bank fails, you become an unsecured creditor and may recover only a portion of your money, if anything. Verify FDIC membership before opening an account at any bank.
Are savings accounts at online banks covered by FDIC insurance?
Yes, if the online bank is an FDIC member. Most major online banks are members. Check the bank's website or contact customer service to confirm. The coverage limit and rules are the same as for traditional banks.
Does FDIC insurance cover interest earned on my account?
Yes. The $250,000 limit includes the principal plus any interest earned up to the moment the bank closes. Interest accrued after the bank's failure is not covered.