Yes, but the coverage limit applies to each account type separately

Your checking and savings accounts at the same bank are insured separately under FDIC rules. This means you get $250,000 of coverage on your checking account and another $250,000 on your savings account at that same institution — not $250,000 total across both. The separation exists because the accounts are legally distinct ownership categories, even though they sit at the same bank.

The catch is that this coverage only works if the accounts are held in the same name and at the same bank. If you move money between the two accounts, the FDIC does not combine the balances for coverage purposes. Each account stands alone for the $250,000 limit.

If you have more than $250,000 in either account, the excess is not covered. Money market accounts follow the same rule as savings accounts — they count as a separate $250,000 category. Certificates of deposit (CDs) also get their own $250,000 limit, separate from checking and savings.

Key Takeaways

  • Checking and savings accounts at the same bank are covered separately, so you have $250,000 protection on each, not $250,000 combined.
  • Money market accounts and CDs are also separate coverage categories, each with its own $250,000 limit at the same bank.
  • Coverage applies only to accounts held in the same name — joint accounts, trust accounts, and retirement accounts are separate categories with their own limits.
  • If you have more than $250,000 in a single account, the excess is uninsured, but you can open accounts at different banks to cover additional balances.
  • The FDIC covers deposits, not investments — stocks, bonds, and mutual funds held through a bank are not covered even if they sit in an account.

What counts as a deposit under FDIC coverage

The FDIC insures money you have deposited at the bank — cash, checks you have deposited, and funds transferred in. It does not cover investments. If your bank offers brokerage services and you buy stocks, bonds, or mutual funds through that bank, those holdings are not FDIC-insured, even though the cash sitting next to them in your account is.

Interest earned on your account is covered as part of the deposit balance. If you have $240,000 in a savings account and earn $5,000 in interest, the total $245,000 is covered. The interest does not push you over the limit unless your balance was already close to $250,000.

Cashier's checks and money orders purchased at the bank are not covered as deposits — they are considered the bank's obligation to pay, not your deposit. Once you cash them or deposit them elsewhere, they become a deposit at the new location.

How joint accounts and trust accounts change the coverage

A joint account — one held in two or more names with equal ownership — gets its own $250,000 coverage limit, separate from any individual accounts you hold alone. If you and your spouse each have $200,000 in individual accounts and $150,000 in a joint account at the same bank, all three amounts are fully covered: $200,000 + $200,000 + $150,000.

A revocable trust account (sometimes called a payable-on-death or POD account) also has separate coverage. If you name beneficiaries in your will or trust and the account is titled as a trust account, the FDIC covers up to $250,000 for each unique beneficiary you name, up to a maximum of five beneficiaries. This is one of the few ways to exceed the standard $250,000 limit at a single bank.

Accounts held in a business name are a separate category from personal accounts. If you are a sole proprietor with a business account and a personal account at the same bank, each gets $250,000 of coverage. Partnerships and corporations have their own coverage rules that differ from individual accounts.

Retirement accounts have their own $250,000 limit

An IRA, SEP-IRA, or other retirement account at a bank is covered separately from your checking and savings accounts. You get $250,000 of coverage on the retirement account itself, distinct from the $250,000 on your checking and the $250,000 on your savings. This means a retirement account does not reduce the coverage available to your other accounts.

The coverage applies to the account balance as of the date of bank failure. If your IRA has $300,000 in it, only $250,000 is covered. The remaining $50,000 is uninsured. Unlike trust accounts, retirement accounts do not get per-beneficiary coverage limits — the $250,000 is a single limit for the entire account, regardless of who inherits it.

What to do if you have more than $250,000 to protect

The simplest way to cover balances above $250,000 is to open accounts at different banks. The FDIC coverage limit is per bank, not per account holder. If you have $400,000 in savings, you could put $250,000 at Bank A and $150,000 at Bank B, and both amounts would be fully covered. The accounts do not have to be at competing banks — they can be at any FDIC-insured institutions.

Before moving money, verify that your new bank is FDIC-insured. You can search the FDIC's Bank Find tool on their website by bank name or location. Credit unions use a similar system called NCUA insurance, which covers up to $250,000 per account type as well, so moving money to a credit union follows the same logic.

If you use multiple banks, keep a straightforward record of which accounts are at which institutions and what the balance is in each. This helps you stay under the $250,000 limit per bank and makes it easier to verify coverage if you ever need to file a claim. The FDIC does not track your accounts for you — you are responsible for knowing where your money sits.

How the FDIC pays out if a bank fails

If an FDIC-insured bank fails, the FDIC steps in and pays depositors up to the coverage limit per account category. The process usually takes a few days. The FDIC will contact you with information about how to claim your insured balance, or your deposits may be transferred automatically to another bank that the FDIC arranges.

You do not have to do anything to set up coverage — it is automatic at any FDIC-insured bank. You also do not pay a fee for it. The FDIC is funded by insurance premiums that banks pay, not by depositors.

If your balance exceeds the coverage limit, the uninsured portion is lost in a bank failure. This is rare — the FDIC has not had a widespread banking crisis in decades — but it is the reason people with large balances spread money across multiple banks.

Frequently Asked Questions

If I move money from my checking account to my savings account, does that reduce my coverage?

No. Moving money between your checking and savings accounts at the same bank does not change your coverage. You still have $250,000 coverage on checking and $250,000 on savings, regardless of how the balance is split between them. The coverage categories are based on account type, not on how much money is in each one.

Are online banks FDIC-insured?

Many online banks are FDIC-insured, but not all. Check the bank's website or use the FDIC Bank Find tool to confirm. Online banks that are FDIC-insured follow the same coverage rules as brick-and-mortar banks — $250,000 per account category. Some online banks offer higher interest rates because they have lower overhead, but the insurance protection is identical.

What if I have $300,000 in a savings account and the bank fails?

The FDIC covers $250,000 of the $300,000. The remaining $50,000 is uninsured and is lost. This is why people with balances above $250,000 open accounts at multiple banks — it is the only way to cover the full amount.

Does FDIC coverage include debit card fraud or stolen money?

No. FDIC coverage protects against bank failure, not fraud or theft. If someone steals from your account or uses your debit card without permission, that is a separate issue handled by your bank's fraud protection and federal consumer protection laws. Contact your bank when ready if you notice unauthorized activity.

If I have a joint account with my spouse, is the $250,000 limit split between us?

No. A joint account gets its own full $250,000 coverage limit as a joint account, separate from any individual accounts either of you holds. If you and your spouse each have $200,000 in individual accounts and $200,000 in a joint account, all $600,000 is covered — the joint account is not split or reduced.