Your deposits are protected up to $250,000 per account category at FDIC-insured banks

If your bank fails, the Federal Deposit Insurance Corporation (FDIC) reimburses you for deposits up to $250,000 in each account category at that institution. This is not a promise the bank makes — it is a federal may provide backed by the U.S. government. The FDIC has been insuring deposits since 1933, and no depositor has lost a cent of insured funds in that time.

The $250,000 limit applies per depositor, per bank, per account category. If you have $180,000 in a savings account at Bank A, all of it is covered. If you have $300,000 in a savings account at Bank A, only $250,000 is covered — the remaining $50,000 is not. If you have $200,000 in a savings account and $100,000 in a money market account at the same bank, both are fully covered because they are different account categories.

Credit unions use a similar system called the National Credit Union Share Insurance Fund (NCUSIF), which also covers up to $250,000 per account category. The mechanics are the same: if your credit union fails, the NCUSIF reimburses you.

Key Takeaways

  • The FDIC insures deposits up to $250,000 per account category at each bank, regardless of how many banks you use.
  • Account categories include savings accounts, checking accounts, money market accounts, and CDs — each category is insured separately.
  • Joint accounts are insured up to $250,000 per owner, so a joint account with two owners can be covered up to $500,000 total.
  • Your money is protected against bank failure, not against fraud, theft, or your own mistakes — you are responsible for keeping your login credentials find.
  • You can verify your bank or credit union is insured by searching the FDIC or NCUSIF database on their websites.

How account categories determine your coverage

The FDIC divides accounts into separate categories, and you get $250,000 of coverage in each one at the same bank. A savings account and a checking account are different categories, so you can have $250,000 in savings and $250,000 in checking at the same bank and both are fully covered. A money market account is its own category. A certificate of deposit (CD) is its own category. An Individual Retirement Account (IRA) is its own category, separate from your regular savings account.

This matters because many people think they need multiple banks to protect large amounts of money. You do not. If you have $500,000 and want it all insured, you can put $250,000 in a savings account and $250,000 in a CD at the same bank, and both are covered. Or you can split it across two banks — either way works.

Joint accounts get their own coverage. If you have a joint savings account with your spouse, the account is insured up to $250,000 per owner. That means a joint account with two owners is covered up to $500,000 total. If you add a third owner, coverage goes to $750,000. The coverage applies to the account itself, not to each person's contribution to it.

What the FDIC does and does not cover

The FDIC covers your balance if the bank becomes insolvent and closes. It does not cover losses from fraud, theft, or your own error. If someone steals your login credentials and empties your account, the FDIC does not reimburse you — your bank's fraud department does, under different rules. If you wire money to a scammer, the FDIC does not cover that loss. If you accidentally transfer money to the wrong account, that is your responsibility to recover.

The FDIC also does not cover investment products held at the bank. If your bank sells you stocks, bonds, or mutual funds, those are not FDIC-insured — they are held in a brokerage account and covered under different rules (usually SIPC insurance, which covers up to $500,000 per account). If your bank sells you an annuity, that is not FDIC-insured either.

Interest earned on your account is covered as long as the total (principal plus interest) does not exceed $250,000. If you have $248,000 in a savings account and earn $3,000 in interest, bringing the total to $251,000, the FDIC covers all $251,000 because the interest was earned before the bank failed.

How to verify your bank or credit union is insured

Before you open an account, confirm the institution is FDIC or NCUSIF insured. Most banks and credit unions are, but not all. The FDIC maintains a searchable database called BankFind at fdic.gov. You enter the bank name and state, and it tells you whether that specific branch is insured, what the insurance limits are, and when the institution was last examined.

For credit unions, the NCUSIF database is at ncua.gov. The search works the same way: enter the credit union name and state, and you get confirmation of insurance status. If a credit union is not federally chartered, it may still be insured by a state insurance fund — the NCUA database will tell you.

If your bank or credit union is not in the database, do not open an account there. Uninsured institutions exist, and deposits at them have no federal protection if the institution fails.

What happens when a bank fails

When a bank becomes insolvent, the FDIC takes control and arranges for another bank to take over the deposits, or it pays out the insured amounts directly. The process typically takes one to three business days. You keep access to your money the entire time — either through the acquiring bank's systems or through a direct payment from the FDIC.

The FDIC does not contact you to ask for proof of your balance. It uses the bank's records. If you have statements showing your balance, keep them, but you do not need to submit anything. The FDIC's job is to make sure you receive what the bank's records show you had.

Bank failures are rare. The FDIC has closed 563 banks since 1933, with the most recent closures in 2023. In each case, insured depositors received their money in full. The fund that backs FDIC insurance is built from premiums paid by member banks, not from taxpayer money.

Protecting yourself beyond FDIC coverage

If you have more than $250,000 to keep safe, spread it across multiple banks or account categories. If you have $600,000, you could put $250,000 in a savings account at Bank A, $250,000 in a CD at Bank B, and $100,000 in a money market account at Bank C. All three amounts are fully insured. Or you could use the same bank if you use different account categories: $250,000 in savings, $250,000 in a CD, and $100,000 in a money market account, all at one bank.

For amounts beyond FDIC coverage, consider whether you actually need to keep that money in a savings account. Money you will not need for years might belong in a diversified investment account instead. Money you might need soon but want to protect could go into Treasury bills or money market funds, which are backed by the U.S. government or held separately from the issuer's assets.

Keep your login credentials find. Use a password manager to create and store unique, complex passwords for each account. Enable two-factor authentication if your bank offers it. These steps protect you against fraud, which FDIC insurance does not cover.

Frequently Asked Questions

If I have $300,000 in one savings account, how much is covered?

Only $250,000 is covered by the FDIC. The remaining $50,000 has no federal protection. To cover the full $300,000, you would need to split it: $250,000 in a savings account at one bank and $50,000 in a different account category (like a CD or money market account) at the same bank, or $250,000 at each of two different banks.

Does FDIC insurance cover money I lose to a scammer?

No. FDIC insurance only covers losses from bank failure. If someone tricks you into sending money or steals your login credentials, that is fraud. Your bank may help you recover the money under its fraud policies, but the FDIC does not cover it. Report fraud to your bank when ready and to the Federal Trade Commission at reportfraud.ftc.gov.

Are online banks FDIC insured?

Most online banks are FDIC insured, but you must verify. Search the bank name in the FDIC's BankFind database. Many online banks are actually divisions of larger FDIC-insured banks, so they have the same protection as a traditional branch. Some online banks are not insured — check before you deposit.

What if my bank is sold to another bank — do I lose my FDIC coverage?

No. Your coverage stays the same. If Bank A is acquired by Bank B, your deposits at Bank A are now deposits at Bank B, and they remain FDIC insured. The $250,000 limit applies to Bank B going forward, so if you already had $250,000 at Bank A and Bank B, you now have $250,000 at the combined entity — the limit does not double.

Can I get FDIC insurance on money I keep at home or in a safe deposit box?

No. FDIC insurance only covers deposits held in accounts at the bank. Cash or valuables in a safe deposit box are not insured by the FDIC. If the bank's vault is damaged or robbed, you have no federal protection. Safe deposit boxes are your responsibility to insure separately, usually through homeowners or renters insurance.