Yes, traditional savings accounts at banks are FDIC insured up to $250,000 per depositor, per bank

If your money sits in a savings account at a bank that holds an FDIC charter, that account is covered. The Federal Deposit Insurance Corporation protects your balance if the bank fails. The limit is $250,000 per person, per institution — meaning if you have $300,000 in one savings account at one bank, only $250,000 is covered.

The key word is "bank." Credit unions use a different insurer (the NCUA), and money market accounts, certificates of deposit, and checking accounts each have their own coverage rules. Online banks count as banks for FDIC purposes if they hold the right charter, so coverage works the same way whether you walk into a branch or log in from home.

FDIC insurance is automatic — you do not need to sign up, pay a fee, or do anything to set up it. It covers you if the bank becomes insolvent and closes. It does not cover losses from fraud, theft, or poor investment choices.

Key Takeaways

  • Traditional savings accounts at FDIC-insured banks are covered up to $250,000 per depositor per bank, with no action required on your part.
  • The $250,000 limit applies to each bank separately, so you can have $250,000 covered at Bank A and another $250,000 covered at Bank B.
  • Online banks have the same FDIC coverage as brick-and-mortar banks if they hold an FDIC charter, which most major ones do.
  • FDIC insurance covers bank failure only — it does not protect you if someone steals your login credentials, the bank makes an error, or you authorize a fraudulent transfer.

How to verify your bank is FDIC insured

You can search the FDIC's official bank database at banks.data.fdic.gov to confirm your bank holds an FDIC charter. Type in the bank name and your state. The search will show you the bank's official name, the date it was insured, and which FDIC region covers it.

Most large national banks and regional banks are FDIC insured. If you use a very small local bank or a non-bank financial institution, the database will tell you whether coverage applies. If a bank does not appear in the search, it is not FDIC insured, and your deposits have no federal protection if it fails.

What happens to your money if the bank fails

When a bank becomes insolvent, the FDIC steps in as the receiver. In most cases, the FDIC arranges for another bank to take over the failed bank's deposits and accounts. Your savings account transfers to the new bank, and you keep access to your money — usually within one to three business days.

If no bank takes over the account, the FDIC pays you directly, up to $250,000. This payout takes longer — typically a few weeks — but you will receive a check or electronic transfer for the insured amount. Anything above $250,000 is not covered and may be lost.

The $250,000 limit and how it works across multiple accounts

The $250,000 limit is per depositor, per bank. If you have one savings account with $300,000 at Bank A, you lose $50,000. If you have two savings accounts at the same bank totaling $300,000, the limit still applies to both combined — you are covered for $250,000 total across both accounts at that bank.

However, if you have $250,000 at Bank A and $250,000 at Bank B, both amounts are fully covered. The FDIC counts each bank separately. Some people use this to protect larger sums by spreading deposits across multiple banks, though this requires managing multiple accounts.

Joint accounts have a separate $250,000 limit. If you and your spouse have a joint savings account with $300,000, you are covered for $250,000. If you each also have individual accounts at the same bank, those are covered separately — up to $250,000 per person.

What FDIC insurance does not cover

FDIC insurance protects you only if the bank fails. It does not cover fraud, theft, or unauthorized transfers. If someone gains access to your account and drains it, that is a fraud claim, not an FDIC claim. You would file a dispute with the bank and potentially report it to law enforcement.

FDIC insurance also does not cover investment losses. If your bank offers brokerage services and you buy stocks or mutual funds through the bank, those investments are not FDIC insured. Stocks, bonds, and mutual funds are securities, not deposits, and they fall under different protections (SEC coverage for securities held by brokers).

Savings bonds, Treasury bills, and other government securities held at a bank are also not FDIC insured, even though they are government backed. The government backing is separate from FDIC coverage.

Online banks and FDIC coverage

Online banks are FDIC insured if they hold an FDIC charter, which the major ones do — including Ally, Marcus, Discover, and Charles Schwab Bank. You can verify any online bank using the FDIC database. Coverage works exactly the same as at a traditional bank: $250,000 per depositor per bank.

The fact that you cannot walk into a physical branch does not change your coverage. Online banks are regulated the same way as brick-and-mortar banks, and the FDIC treats them identically for insurance purposes.

Frequently Asked Questions

If I have $250,000 in a savings account and $250,000 in a checking account at the same bank, am I fully covered?

No. Savings and checking accounts are counted together under one $250,000 limit per bank. You would be covered for $250,000 total across both accounts. To protect both amounts, you would need to use two different banks.

Does FDIC insurance cover money I lose to a scam?

No. FDIC insurance covers bank failure only. If you send money to a scammer or authorize a fraudulent transfer, that is a fraud dispute, not an FDIC claim. You would report it to your bank and law enforcement. Your bank may recover some funds depending on how quickly you report it, but FDIC insurance does not explore.

What if my bank is bought by another bank?

A merger or acquisition is not a bank failure, so FDIC insurance does not trigger. Your account straightforward transfers to the new owner. Your coverage continues under the new bank's FDIC charter. If you are concerned about the merger, you can move your money to another bank before it closes, but you are not required to.

Are savings accounts at credit unions FDIC insured?

No. Credit unions are insured by the National Credit Union Administration (NCUA), not the FDIC. NCUA coverage works similarly — up to $250,000 per member per credit union — but it is a separate system. Check your credit union's charter to confirm NCUA coverage.

If I have a savings account with $100,000 and a money market account with $200,000 at the same bank, how much is covered?

Money market accounts have their own $250,000 limit separate from savings accounts. Your $100,000 savings account is fully covered, and your $200,000 money market account is fully covered. The two are counted separately by the FDIC.