Money market accounts are FDIC insured up to $250,000 per depositor, per bank, in the same ownership category

A money market account at a bank is covered by FDIC insurance the same way a savings account or checking account is. The $250,000 limit applies to the total of all your money market accounts at that single bank, not per account. If you have $150,000 in a money market account and $120,000 in a savings account at the same bank, only $250,000 of the combined total is insured—you would lose $20,000 if the bank failed.

The protection covers the account balance as it stands on the day the bank closes. Interest that has been credited to the account counts toward the $250,000 limit. Interest that accrued but was not yet credited does not.

Money market accounts at credit unions work differently. They are insured by the National Credit Union Administration (NCUA), not the FDIC, but the coverage limit is also $250,000 per depositor, per institution.

Key Takeaways

  • FDIC insurance covers money market accounts at banks up to $250,000 per depositor, per bank, combined with all other deposit accounts in the same ownership category.
  • The $250,000 limit is shared across all your deposit accounts at one bank—a money market account, savings account, and checking account all count toward the same ceiling.
  • To protect balances above $250,000, you can open accounts at different banks, each with its own $250,000 protection.
  • Money market accounts at credit unions are insured by the NCUA, not the FDIC, but the $250,000 limit is the same.
  • Interest credited to the account counts toward the limit; interest that has accrued but not yet posted does not.

How the $250,000 limit works across multiple accounts at one bank

The FDIC insures by ownership category, not by account type. If you own accounts in your name alone, all of them at one bank—checking, savings, money market, certificates of deposit—share a single $250,000 protection pool. You cannot get $250,000 coverage for a money market account and another $250,000 for a savings account at the same bank.

If you are married and both spouses own the account jointly, that joint account has its own $250,000 limit, separate from either spouse's individual accounts. So a husband could have $250,000 in an individual money market account, and the couple could have another $250,000 in a joint money market account at the same bank, and both would be fully insured.

Accounts held in trust, accounts for a minor with a custodian, and accounts designated as payable-on-death (POD) to a named beneficiary each have their own $250,000 limit. The ownership category determines which limit applies.

What happens if you have more than $250,000 to deposit

The standard approach is to spread money across different banks. If you have $500,000, you could put $250,000 at Bank A and $250,000 at Bank B, and both amounts would be fully insured. Each bank is a separate FDIC member, so each has its own $250,000 ceiling.

Some people use a service called a deposit sweep program to manage this automatically. You deposit money into one account, and the program divides it across multiple FDIC-insured banks behind the scenes, keeping each bank's portion under $250,000. The account appears to be at one institution from your perspective, but the FDIC insures each portion separately. Ask your bank whether it offers this service; not all do.

Another option is to use different ownership categories at the same bank. A married couple could have $250,000 in a joint account and $250,000 in individual accounts (one for each spouse), all at the same bank, and all fully insured. This works only if the accounts are genuinely in different names or ownership structures—you cannot straightforward list different people on the same account to create multiple coverage pools.

Money market accounts versus money market funds

A money market account is a bank deposit product. It is FDIC insured. It typically pays interest and may allow a limited number of withdrawals per month.

A money market fund is an investment product sold by brokerages and investment firms. It is not FDIC insured. It invests in short-term debt securities and aims to maintain a stable share price, but there is no may provide. Money market funds are regulated by the Securities and Exchange Commission (SEC), not the FDIC.

The names are similar enough that people sometimes confuse them. If you want FDIC insurance, you need a money market account at a bank or credit union, not a money market fund.

FDIC coverage for money market accounts at online banks

An online bank is still a bank. If it is FDIC insured, a money market account there is covered the same way as one at a brick-and-mortar bank. The FDIC does not distinguish between online and in-person institutions—it insures the deposits.

Before opening a money market account at any bank, check whether the bank itself is FDIC insured. You can search the FDIC's Bank Find tool on the FDIC website by bank name or location. If the bank is not listed, it is not FDIC insured, and your deposits are not protected.

Some online banks are FDIC insured; others are not. The fact that a bank operates online does not tell you either way. Always verify.

What FDIC insurance does not cover

FDIC insurance covers the balance in the account. It does not cover investment losses if the money market account is linked to or invested in securities. It does not cover fees charged by the bank. It does not cover fraud or theft by someone other than the bank itself.

If someone steals your login credentials and withdraws money from your account, that is a separate matter from FDIC insurance. Your bank's fraud liability policy, and your own responsibility to report unauthorized transactions promptly, determine what happens next. FDIC insurance does not explore.

If the bank itself fails—the institution becomes insolvent and closes—the FDIC steps in and pays depositors up to the $250,000 limit per ownership category. That is what FDIC insurance is for.

Frequently Asked Questions

If I have $300,000 in a money market account at one bank, how much is insured?

$250,000 is insured. The remaining $50,000 is not protected by the FDIC. To insure the full amount, you would need to move $50,000 to a money market account at a different FDIC-insured bank.

Does a money market account earn interest that counts toward the $250,000 limit?

Interest that has been credited to the account counts toward the limit. If you have $240,000 in the account and $15,000 in interest is credited, your total is now $255,000, and only $250,000 is insured. Interest that accrues but has not yet been posted to the account does not count.

Are money market accounts at credit unions FDIC insured?

No. Credit union accounts are insured by the NCUA, not the FDIC. The coverage limit is the same—$250,000 per depositor, per institution—but the insurer is different. Make sure your credit union is NCUA insured by checking the NCUA's credit union search tool.

Can I get $250,000 coverage for a money market account and another $250,000 for a savings account at the same bank?

No. All deposit accounts you own individually at one bank share a single $250,000 limit, regardless of account type. To have two separate $250,000 protections, you need two different banks or two different ownership categories (such as individual and joint accounts).

What if the bank I use is not FDIC insured?

Your money market account would not be protected if the bank failed. Search the FDIC's Bank Find tool before opening an account to confirm the bank is FDIC insured. If it is not, consider moving your money to an insured institution.