FDIC insurance covers up to $250,000 per depositor, per bank, per account ownership category

The Federal Deposit Insurance Corporation (FDIC) protects your money if the bank fails. The standard coverage limit is $250,000 per person at each bank. If you have $300,000 in a savings account at one bank, the FDIC covers $250,000 and you lose the rest.

The limit applies to each bank separately, not to your total deposits across all banks. If you have $250,000 at Bank A and $250,000 at Bank B, both are fully covered. The account type also matters — a savings account, checking account, and money market account at the same bank are each covered separately up to $250,000.

Joint accounts have their own coverage limit. If you and another person own a joint savings account together, that account is covered up to $250,000 as a joint account, separate from any individual accounts either of you holds at that same bank.

Key Takeaways

  • The FDIC covers $250,000 per person per bank, so splitting deposits across multiple banks increases your total protection.
  • Different account types at the same bank — savings, checking, money market — each have their own $250,000 limit.
  • Joint accounts are insured separately from individual accounts, so a couple can protect up to $500,000 at one bank ($250,000 individual + $250,000 joint).
  • FDIC coverage is automatic at member banks; you do not need to sign up or pay a fee.
  • If a bank fails, the FDIC typically transfers your deposits to another bank or sends you a check within days.

How account ownership type changes your coverage

The FDIC recognizes different ownership categories, and each one has its own $250,000 limit at the same bank. An individual account, a joint account, and a retirement account (IRA) are three separate categories. If you have $250,000 in your individual savings account, $250,000 in a joint account with your spouse, and $250,000 in an IRA, all three are covered in full at that one bank.

Accounts held in trust for someone else also have separate coverage. If you are the trustee of a trust account, that account is covered up to $250,000 separately from your personal accounts. The same applies to accounts you hold as a custodian for a minor.

Business accounts are covered separately from personal accounts. If you own a sole proprietorship and have both a personal savings account and a business savings account at the same bank, each is covered up to $250,000.

What happens if you exceed the $250,000 limit

Money above $250,000 at a single bank is not covered by the FDIC. If the bank fails, you lose access to the excess amount. The bank does not warn you when you approach the limit — it is your responsibility to track your balance and move money to another bank if you want full protection.

The easiest way to protect more than $250,000 is to spread it across multiple FDIC-member banks. You can open accounts at different banks under your own name, or use different ownership categories (individual, joint, IRA) at the same bank if that fits your situation. Some people use a service like IntraFi or Promontory Interbank Network, which automatically splits large deposits across multiple banks and keeps them within FDIC limits, but this is mainly used by banks and financial advisors, not individual depositors.

FDIC coverage does not explore to all products

FDIC insurance covers deposit accounts: savings accounts, checking accounts, money market accounts, and certificates of deposit (CDs). It does not cover stocks, bonds, mutual funds, or brokerage accounts, even if held at a bank. It also does not cover safe deposit boxes or their contents.

If you buy a CD at a bank, it is covered up to $250,000 like any other deposit. If you buy a mutual fund through the bank's brokerage arm, it is not covered by FDIC insurance — it may be covered by SIPC (Securities Investor Protection Corporation) instead, which is a different protection with different limits.

How to verify a bank is FDIC-insured

Most banks are FDIC members, but not all. Credit unions are insured by the NCUA (National Credit Union Administration), not the FDIC, though the coverage limit is the same: $250,000 per person per institution. Before opening an account, check the bank's website or call and ask directly whether it is FDIC-insured.

You can also search the FDIC's Bank Find tool on their website. Enter the bank name and state, and it will tell you whether the bank is insured and what its coverage limits are. This tool is free and takes less than a minute.

What happens when a bank fails

If an FDIC-member bank fails, the FDIC steps in automatically. You do not need to file a claim or contact the FDIC yourself. In most cases, the FDIC arranges for another bank to take over the failed bank's deposits, and your account straightforward moves to the new bank. You keep your debit card, online access, and account number — often without any interruption.

If no bank takes over the deposits, the FDIC sends you a check for the amount covered (up to $250,000). This process typically takes a few days to a week. The FDIC has never failed to pay out covered deposits since it was created in 1933.

Frequently Asked Questions

Does FDIC insurance cover my savings account if I have multiple accounts at the same bank?

It depends on the account type. A savings account, checking account, and money market account are each covered separately up to $250,000. If you have two savings accounts at the same bank, they are combined and covered as one account up to $250,000 total.

Are joint accounts covered differently than individual accounts?

Yes. A joint account is covered separately from individual accounts. If you and your spouse each have a $250,000 individual account and a $250,000 joint account at the same bank, all three accounts are fully covered — the bank does not combine them.

What if I have more than $250,000 and want it all protected?

Open accounts at different FDIC-member banks. You can have $250,000 at Bank A, $250,000 at Bank B, and so on, and each amount is fully covered. You can also use different ownership categories (individual, joint, IRA) at the same bank to increase coverage.

Is my money at a credit union covered by FDIC insurance?

No. Credit unions are insured by the NCUA, not the FDIC. The coverage limit is the same ($250,000 per person per institution), but it is a separate insurance program.

Do I have to pay for FDIC insurance?

No. FDIC coverage is automatic at member banks and costs you nothing. You do not sign up, pay a fee, or do anything to set up it.