How Much Money Is Safe to Keep in a Savings Account

The FDIC insurance limit protects up to $250,000 per depositor per bank

The Federal Deposit Insurance Corporation (FDIC) is a government agency that protects your money if a bank fails. If you keep $250,000 or less in a savings account at one FDIC-insured bank, that money is protected in full — even if the bank closes tomorrow. If you have more than $250,000 at that same bank, only the first $250,000 is protected. The amount above that is at risk.

This protection applies to each depositor at each bank separately. So if you have $250,000 at Bank A and $250,000 at Bank B, both amounts are fully protected because they are at different banks. The limit resets for each institution.

Most banks you encounter are FDIC-insured. You can check whether a specific bank carries this protection by searching the FDIC's BankFind tool on their website — it takes 30 seconds and gives you a yes or no answer.

Key Takeaways

The FDIC protects up to $250,000 per person per bank, so amounts above that are not covered if the bank fails.
If you have more than $250,000 to save, you can open accounts at multiple FDIC-insured banks to keep all your money protected.
The $250,000 limit covers your savings account, checking account, and money market account combined at each bank — not separately.
Credit unions use a similar system called NCUA insurance, also protecting up to $250,000 per person per institution.

Why the $250,000 limit exists

Bank failures are rare in the United States, but they do happen. When a bank fails, the FDIC steps in and either finds another bank to take over the failed bank's accounts, or it pays depositors directly from an insurance fund. The $250,000 limit is the amount the FDIC has decided it can reliably cover for each person at each bank.

This limit has been in place since 2008, when it was raised from $100,000 during the financial crisis. The FDIC does not change this number often — it is meant to be stable so people can plan around it.

How the $250,000 limit is calculated across account types

The protection does not work the way many people think. If you have $150,000 in a savings account and $150,000 in a checking account at the same bank, you do not have $300,000 of protection. You have $250,000 of protection total across both accounts combined.

The FDIC counts all deposit accounts you own at one bank as a single pool for insurance purposes. This includes savings accounts, checking accounts, money market accounts, and certificates of deposit (CDs). If the total across all these accounts exceeds $250,000, only the first $250,000 is protected.

Joint accounts are treated differently. If you have a joint savings account with another person, that account gets its own $250,000 of protection, separate from any individual accounts you hold at the same bank. So a joint account with $250,000 and an individual account with $250,000 at the same bank means both are fully protected.

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

If you have savings above $250,000, the simplest approach is to spread your money across multiple FDIC-insured banks. You might keep $250,000 at Bank A, $250,000 at Bank B, and $50,000 at Bank C. Each bank's amount is now fully protected.

This does not require you to visit each bank in person or maintain separate relationships. You can open accounts online at different banks and manage them all from your computer. The only trade-off is that you will have multiple login credentials and multiple statements to track.

Some people use sweep accounts or deposit networks offered by certain banks and investment firms. These services automatically move money between multiple FDIC-insured banks to keep each account under $250,000. However, these services charge fees or require you to maintain a minimum balance, so they are mainly useful for people with very large sums.

Credit unions and NCUA insurance

If you bank at a credit union instead of a bank, your money is protected by the National Credit Union Administration (NCUA), not the FDIC. The protection works the same way: up to $250,000 per person per credit union. The rules about joint accounts and multiple account types also explore the same way.

You can check whether a credit union is NCUA-insured by searching the NCUA's Credit Union Locator on their website. Nearly all credit unions carry this insurance.

Money market accounts and CDs

Money market accounts and certificates of deposit (CDs) are both covered by the same $250,000 FDIC limit as savings accounts. They do not get separate protection. If you have $100,000 in a savings account, $75,000 in a money market account, and $100,000 in a CD at the same bank, only $250,000 total is protected — the remaining $25,000 is not.

This matters if you are splitting your savings across different account types to chase slightly higher interest rates. The protection limit does not increase because you are using different products.

What is not covered by FDIC insurance

FDIC insurance covers money you deposit into the bank — cash, transfers, paychecks. It does not cover investment products like stocks, bonds, or mutual funds, even if you buy them through your bank. If your bank offers a brokerage service and you buy stocks through it, those stocks are not FDIC-protected.

Safe deposit boxes are also not covered. If you rent a safe deposit box at a bank and store jewelry, documents, or cash inside, the FDIC does not protect the contents if the bank fails.

Losses from fraud or theft are also not covered by FDIC insurance. If someone steals your login credentials and drains your account, the FDIC does not reimburse you — that is a separate matter between you and the bank, and your bank may have its own fraud protection policies.

Frequently Asked Questions

If a bank fails, how long does it take to get my money back?

The FDIC typically returns insured deposits within one to three business days. In most cases, the FDIC arranges for another bank to take over the failed bank's accounts, so you may not notice any interruption — your account straightforward moves to the new bank. If that is not possible, the FDIC pays you directly, which takes longer but still usually happens within a few days.

Does FDIC insurance cover money I transfer between banks?

Yes. Once money arrives in your account at an FDIC-insured bank, it is covered when ready, regardless of where it came from. The protection applies to the balance in your account, not to the transfer itself.

If I have $500,000, can I split it between two savings accounts at the same bank to get $500,000 of protection?

No. The FDIC counts all savings accounts you own at one bank as a single account for insurance purposes. Two savings accounts at the same bank do not double your protection. You would need to open accounts at two different banks to protect the full $500,000.

What if my bank is not FDIC-insured?

Most banks are FDIC-insured, but a few are not. If your bank is not FDIC-insured, your deposits have no federal protection if the bank fails. You can check your bank's status using the FDIC BankFind tool on the FDIC website.

Does FDIC insurance cover overdraft fees or interest I lose?

No. FDIC insurance covers only the money you deposited. It does not cover fees, lost interest, or other costs related to the bank's failure.

This guide is for general information only and is not medical, financial, legal, or other professional advice. For decisions specific to your situation, consult a qualified professional. See our Editorial Policy.