FDIC insurance covers both checking and savings accounts, but only up to $250,000 per depositor per bank
Yes, the Federal Deposit Insurance Corporation (FDIC) covers money in both checking and savings accounts. The standard coverage limit is $250,000 per depositor per insured bank. That means if you have $100,000 in checking and $150,000 in savings at the same bank, you are fully covered. If you have $300,000 total at that bank, only $250,000 is protected—the remaining $50,000 is not.
The $250,000 limit applies to each bank separately, not to your total across all banks. If you have $250,000 at Bank A and $250,000 at Bank B, both amounts are covered because they are at different institutions. The FDIC does not care how many accounts you have at one bank—checking, savings, money market, certificates of deposit—they all count toward the single $250,000 limit at that location.
FDIC coverage is automatic. You do not need to sign up, pay a fee, or do anything to set up it. If your bank fails, the FDIC steps in and returns your covered deposits, usually within one to three business days. The coverage applies whether your bank closes suddenly or gradually runs out of money.
Key Takeaways
- FDIC insurance covers up to $250,000 per depositor per bank for all deposit accounts combined, including checking and savings.
- The $250,000 limit resets at each different bank, so spreading money across multiple banks increases your total coverage.
- Coverage is automatic and costs you nothing—you do not need to register or take any action.
- Joint accounts, retirement accounts, and trust accounts have separate coverage limits from your individual accounts at the same bank.
- Money market accounts and certificates of deposit count toward the $250,000 limit alongside checking and savings.
How the $250,000 limit works across multiple accounts at one bank
If you have three accounts at the same bank—a checking account with $80,000, a savings account with $100,000, and a money market account with $90,000—the FDIC adds them together. That is $270,000 total. Only $250,000 is covered. The remaining $20,000 sits outside FDIC protection.
The type of account does not matter. A certificate of deposit (CD) counts the same way. If you have $200,000 in CDs and $100,000 in savings at one bank, you have $300,000 in coverage-may be able to access deposits, but only $250,000 is actually protected. The FDIC does not separate them by account type—it is one pool per depositor per bank.
This is where many people make a mistake: opening multiple savings accounts at the same bank does not increase your coverage. The FDIC sees all your accounts at that bank as one depositor with one $250,000 limit. The number of accounts is irrelevant.
How coverage changes with joint accounts and retirement accounts
Joint accounts have their own $250,000 limit, separate from your individual accounts. If you and your spouse have a joint savings account with $250,000 at Bank A, and you also have an individual checking account with $200,000 at the same bank, both are fully covered. The joint account gets $250,000 of protection, and your individual account gets another $250,000.
Retirement accounts—IRAs, SEP-IRAs, and similar accounts—also have a separate $250,000 limit. If you have a traditional IRA with $250,000 and a regular savings account with $250,000 at the same bank, both are fully protected because they fall into different coverage categories.
Trust accounts work the same way. A revocable living trust account has its own $250,000 limit at each bank. This is useful if you are holding money in trust for beneficiaries, because the coverage does not reduce your personal limit.
What happens when a bank fails and FDIC coverage kicks in
When an FDIC-insured bank closes, the FDIC takes over and pays out covered deposits. The process usually takes one to three business days, though it can take longer if the bank's records are complex or incomplete. You do not have to file a claim or contact the FDIC yourself—the agency contacts you.
The FDIC pays you up to the coverage limit in your name. If you had $300,000 at a failed bank and the limit is $250,000, you receive $250,000. The uncovered $50,000 becomes part of the bank's assets, which may eventually pay out to creditors, but that process is separate and usually recovers little or nothing.
You can check whether a bank is FDIC-insured before you open an account. The FDIC maintains a searchable database called BankFind that lists every insured institution. If a bank is not on that list, your deposits there have no federal insurance.
Coverage limits for specific account types
| Account Type | Coverage Limit | Separate from Individual Accounts? |
|---|---|---|
| Individual checking or savings | $250,000 per depositor per bank | No—combined limit |
| Joint account | $250,000 per bank | Yes—separate limit |
| Traditional or Roth IRA | $250,000 per depositor per bank | Yes—separate limit |
| Certificate of Deposit (CD) | $250,000 per depositor per bank | No—counts toward individual limit |
| Money market account | $250,000 per depositor per bank | No—counts toward individual limit |
| Revocable trust account | $250,000 per beneficiary per bank | Yes—separate limit |
Strategies for protecting money above $250,000
If you have more than $250,000 to deposit, the simplest approach is to spread it across multiple FDIC-insured banks. Put $250,000 at Bank A, $250,000 at Bank B, and so on. Each bank's deposits are covered separately, so you get full protection on all of it.
You can also use different account categories at the same bank. A $250,000 individual account and a $250,000 joint account at the same bank are both fully covered because they fall into different coverage categories. Similarly, a $250,000 individual account and a $250,000 IRA at the same bank each get their own $250,000 limit.
Some people use a combination: $250,000 in an individual account at Bank A, $250,000 in a joint account at Bank A, and $250,000 in an IRA at Bank B. This spreads risk across institutions and maximizes coverage. The FDIC website has a calculator that shows you exactly how much of your money is covered given your specific account setup.
What FDIC insurance does not cover
FDIC insurance covers only deposits—money you have placed in the bank. It does not cover investments held at the bank, such as stocks, bonds, mutual funds, or brokerage accounts. If your bank has a brokerage arm and you buy stocks through it, those stocks are not FDIC-insured, even though the cash sitting in your brokerage account may be.
Safe deposit boxes are also not covered. If you store valuables, documents, or cash in a safe deposit box at a bank, the FDIC does not protect them if the bank fails. The contents of the box are your responsibility.
Foreign currency deposits are covered only if they are held in U.S. dollars. If you deposit euros or another currency, the FDIC does not cover that. Interest earned on deposits is covered as long as the total (principal plus interest) does not exceed the $250,000 limit.
Frequently Asked Questions
If I have $300,000 in a savings account at one bank, how much is covered?
Only $250,000 is covered by FDIC insurance. The remaining $50,000 has no federal protection. To cover all $300,000, you would need to move $50,000 to a different FDIC-insured bank, or use a separate account category like a joint account or IRA at the same bank.
Does FDIC insurance cover money in online banks?
Yes, if the online bank is FDIC-insured. Most major online banks are insured. You can verify by searching the bank's name in the FDIC's BankFind database. Coverage limits and rules are identical to brick-and-mortar banks.
If my spouse and I have a joint account with $300,000, is all of it covered?
No. Joint accounts have a $250,000 FDIC limit, so $250,000 is covered and $50,000 is not. However, if you also have an individual account at the same bank, that account has its own separate $250,000 limit.
What happens to interest I earned on my deposits if the bank fails?
Interest earned counts toward your coverage limit. If you had $240,000 in a savings account and earned $15,000 in interest before the bank failed, the FDIC covers all $255,000 because it is still under the $250,000 limit. If you had $245,000 and earned $10,000, only $250,000 total is covered.
Are money market accounts at banks covered the same way as savings accounts?
Yes. Money market accounts at banks are FDIC-insured up to $250,000 per depositor per bank, and they count toward the same limit as your checking and savings accounts. (Money market funds sold by investment firms are different and are not FDIC-insured.)