The FDIC insures up to $250,000 per depositor, per bank, per account category

The Federal Deposit Insurance Corporation (FDIC) is a government agency that protects your money if your bank fails. When a bank closes, the FDIC pays depositors back up to a set limit. That limit is $250,000 per person, at each bank, in each type of account you hold there.

The key word is "per bank." If you have $200,000 at Bank A and $200,000 at Bank B, both amounts are fully protected. But if you have $300,000 at a single bank in a single account type, only $250,000 is insured. The extra $50,000 is not protected.

This protection applies to checking accounts, savings accounts, money market accounts, and certificates of deposit (CDs). It does not cover stocks, bonds, mutual funds, or safety deposit boxes — those are not bank deposits and are not FDIC-insured.

Key Takeaways

  • The FDIC insures up to $250,000 per depositor, per bank, per account category, meaning you can have more than $250,000 protected if you split it across different banks or account types.
  • Money in a joint account is insured separately from money in an individual account at the same bank, so a joint savings account and an individual savings account each get their own $250,000 protection.
  • Retirement accounts like IRAs are insured up to $250,000 separately from your regular deposit accounts at the same bank.
  • The FDIC does not insure investment products like stocks, bonds, or mutual funds, even if you buy them through your bank.
  • Not all banks are FDIC-insured; you can check whether your bank participates by searching the FDIC's bank database on their website.

How account ownership type changes your coverage

The FDIC counts money differently depending on whose name is on the account. An account in your name alone is insured separately from an account you share with someone else, even at the same bank.

A joint account — one with two or more owners — is insured up to $250,000 total for the account itself. Each owner's share is not counted separately. So if you and your spouse have a joint savings account with $300,000, only $250,000 is protected. The remaining $50,000 is not.

However, if you have an individual savings account with $200,000 and a joint savings account with $200,000 at the same bank, both are fully protected. The individual account gets $250,000 of coverage, and the joint account gets its own separate $250,000 of coverage.

If you are the sole owner of one account and a co-owner of another account at the same bank, those are treated as separate accounts for insurance purposes. This is one reason some people with large amounts of money open accounts at multiple banks or in different names.

Retirement accounts get their own separate limit

Money in a retirement account — such as a traditional IRA, Roth IRA, or SEP IRA — is insured separately from your regular deposit accounts. This means if you have $250,000 in a regular savings account and $250,000 in an IRA at the same bank, both amounts are fully protected.

The $250,000 limit still applies to each retirement account type. If you have two separate IRAs at the same bank with $200,000 in each, only one of them is fully protected. The FDIC counts all IRAs you own at the same bank together and insures the total up to $250,000.

This rule applies even if the IRAs are different types — a traditional IRA and a Roth IRA at the same bank are added together for insurance purposes. If you have $150,000 in a traditional IRA and $150,000 in a Roth IRA at the same bank, the total is $300,000, but only $250,000 is insured.

What happens when you exceed the $250,000 limit

If your account balance goes above $250,000 at a single bank, the FDIC does not automatically move the extra money to safety. It straightforward remains uninsured. If the bank fails, you will recover up to $250,000, and anything above that is lost.

The FDIC does not charge you for this protection, and you do not have to do anything to set up it. Coverage is automatic for all deposit accounts at FDIC-insured banks. You do not receive a certificate or confirmation — the protection exists whether you know about it or not.

If you have more than $250,000 to keep safe, the most common approach is to spread it across multiple banks. Some people also use different account categories — for example, keeping some money in a regular savings account and some in a CD — though both are still limited to $250,000 each at the same bank.

Banks that are not FDIC-insured

Not every bank is FDIC-insured. Most traditional banks and credit unions are, but some online banks, investment firms, and smaller institutions are not. If your bank fails and it is not FDIC-insured, you have no federal protection for your deposits.

You can check whether your bank is FDIC-insured by visiting the FDIC's official website and using their bank search tool. You enter your bank's name and it tells you whether that specific location is covered. This takes less than a minute and is worth doing if you are moving money to a new bank or opening an account somewhere unfamiliar.

Credit unions are not FDIC-insured, but they are covered by a similar program called the National Credit Union Administration (NCUA). NCUA insurance works the same way — up to $250,000 per member, per credit union, per account category. If you bank at a credit union, your deposits are protected under NCUA rules, not FDIC rules.

How the FDIC pays you back if a bank fails

When a bank fails, the FDIC takes over and begins paying depositors. The process usually takes a few weeks. The FDIC contacts you with information about how to recover your insured funds — either by transferring them to another bank or receiving a check.

You do not have to file a claim or prove you had money there. The FDIC has records of all deposits and knows exactly how much each person is owed. If you had $200,000 in a savings account, you will receive $200,000. If you had $300,000, you will receive $250,000.

Bank failures are rare in the United States. The FDIC has been operating since 1933, and most people never experience a bank failure in their lifetime. The insurance exists as a safety net, not because bank failures happen often.

Frequently Asked Questions

If I have $500,000, how do I protect all of it?

Open accounts at two different FDIC-insured banks. Put $250,000 at Bank A and $250,000 at Bank B, and both amounts are fully protected. You can also split money across different account types — for example, a savings account and a CD — but only at different banks, since the $250,000 limit applies per bank per category.

Does FDIC insurance cover money I owe the bank?

No. FDIC insurance protects deposits you have placed in the bank. It does not cover loans, credit card balances, or other money you owe. If you have a $10,000 overdraft, that is a debt, not a deposit, and is not insured.

What if I have a savings account and a checking account at the same bank?

Both accounts are in the same category — deposit accounts — so they are added together for insurance purposes. If your savings account has $200,000 and your checking account has $100,000 at the same bank, the total is $300,000, but only $250,000 is insured. You would need to move one account to a different bank to protect both fully.

Does FDIC insurance cover money in a safe deposit box?

No. A safe deposit box is a physical storage space the bank rents to you. The contents — jewelry, documents, cash — are not FDIC-insured. If the bank fails or the box is damaged, you have no federal protection. The bank may have liability insurance, but that is separate from FDIC coverage.

If I add someone else's name to my account, does that increase my insurance coverage?

Yes, but only if they are a true co-owner. A joint account with two owners is insured up to $250,000 for the account itself. However, adding someone as a beneficiary or power of attorney does not increase coverage — only true joint ownership does, and it must be a genuine shared account, not a paperwork arrangement.