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

The Federal Deposit Insurance Corporation insures your money at each bank separately. If you have $250,000 in a checking account at Bank A and $250,000 in a savings account at Bank B, both are fully covered. If you have $500,000 at a single bank in a single account, only $250,000 is protected—the rest is at risk if the bank fails.

The $250,000 limit applies to the total of all deposits you own in the same category at the same bank. A checking account and a savings account at the same bank count toward the same $250,000 limit because you own both. A joint account with your spouse counts as a separate $250,000 limit because your spouse is a co-owner, not you alone.

FDIC coverage is automatic. You do not need to sign up, pay a fee, or do anything to set up it. If your bank fails, the FDIC pays you directly, usually within a few business days.

Key Takeaways

  • The FDIC covers $250,000 per person, per bank, per ownership type—meaning you can have $250,000 covered in your name alone and another $250,000 covered in a joint account at the same bank.
  • Deposits at different banks are insured separately, so spreading money across multiple banks can increase your total coverage without any action on your part.
  • Coverage includes checking, savings, money market, and certificate of deposit accounts, but not stocks, bonds, mutual funds, or safe deposit boxes.
  • If a bank fails, the FDIC typically pays covered deposits within one to three business days, and you do not need to file a claim.

How the $250,000 limit breaks down by account ownership

The FDIC recognizes different ownership categories, and each one gets its own $250,000 protection at the same bank. This means you can have multiple accounts at one bank and be fully covered if you structure them correctly.

An account in your name alone is covered up to $250,000. An account you own jointly with another person (such as a spouse or adult child) is covered up to $250,000 as a separate category. A revocable trust account—where you name beneficiaries who will inherit the money—is covered up to $250,000 per beneficiary you name, up to a total of $250,000 for the account. An irrevocable trust, a business account, or a retirement account (IRA, 401k) each get their own $250,000 limit.

The key word is separate. If you have $100,000 in a checking account in your name and $200,000 in a savings account in your name at the same bank, you have $300,000 in coverage but only $250,000 is protected. The extra $50,000 is uninsured. If you move that $200,000 to a joint account with your spouse, both accounts are now fully covered because they fall into different ownership categories.

What happens when you exceed the $250,000 limit at one bank

Money above $250,000 in the same ownership category at the same bank is not covered by the FDIC. If the bank fails, you lose it. This is not a gradual loss—the uninsured portion straightforward disappears from your account.

The FDIC does not warn you or freeze your account when you cross the limit. You are responsible for tracking your own coverage. Many banks show FDIC coverage information in your account statements or online banking portal, but you should verify it yourself using the FDIC's Electronic Deposit Insurance Estimator tool on their website, which calculates your exact coverage based on your account structure.

If you have more than $250,000 to keep safe, the solution is to spread it across multiple banks. A $500,000 deposit split between two banks ($250,000 at each) is fully covered. There is no limit to how many banks you can use, and the FDIC insures each one independently.

Coverage that does and does not count toward the $250,000 limit

The FDIC covers money held in deposit accounts: checking, savings, money market accounts, and certificates of deposit (CDs). Interest that accrues on your account before the bank fails is also covered as long as your total does not exceed $250,000.

The FDIC does not cover stocks, bonds, mutual funds, brokerage accounts, or safe deposit boxes, even if they are held at an FDIC-insured bank. It also does not cover U.S. Treasury securities or money you lend to the bank (such as a loan you made to the bank itself). If your bank offers investment services, those products sit outside FDIC protection entirely.

Cashier's checks, money orders, and traveler's checks issued by the bank are covered if they have not been cashed yet, because they are still considered deposits. Once you cash them, they are no longer the bank's liability and are no longer covered.

How multiple banks increase your total coverage

Each bank is a separate FDIC entity. If you have $250,000 at Chase and $250,000 at Bank of America, both amounts are fully covered because they are at different banks. You can have ten banks with $250,000 each and be fully covered at all of them.

This matters if you have a large amount of money to store. A business owner with $1 million in operating funds could keep $250,000 at five different banks and be fully protected. A retiree with $750,000 in savings could keep $250,000 in their name at Bank A, $250,000 in a joint account with their spouse at Bank B, and $250,000 in a revocable trust at Bank C, with all three fully covered.

The FDIC tracks coverage by the bank's charter number, not by the bank's name. Some large banks operate multiple charters (separate legal entities), which means deposits at different divisions of the same company may be insured separately. Before assuming two accounts at the same company are at different banks, check the FDIC's bank search tool or call the bank directly to confirm the charter number.

What happens if your bank fails

If an FDIC-insured bank fails, the FDIC steps in and pays covered deposits directly to you. You do not need to file a claim or contact the FDIC yourself. The bank's failure is announced, and the FDIC typically pays within one to three business days, though it can take longer if your account structure is complex or if the bank has millions of accounts to process.

You will receive payment in the form of a check, a transfer to another bank account, or a new account at a successor bank if the FDIC arranges for another bank to take over the failed bank's deposits. In most cases, you can access your money almost when ready—the FDIC's goal is to minimize disruption to depositors.

Bank failures are rare. The FDIC has been in operation since 1933, and in that time, the vast majority of banks have remained solvent. The FDIC's insurance fund is backed by premiums that banks pay, not by taxpayer money, though Congress can authorize borrowing if the fund is depleted (which has happened only once, during the 2008 financial crisis).

How to verify your coverage

The FDIC's Electronic Deposit Insurance Estimator is a free tool on the FDIC website that calculates your exact coverage based on the account types and ownership structures you enter. You can run through different scenarios—such as adding a joint account or moving money to another bank—and see how your coverage changes.

You can also call your bank and ask them to explain your coverage. Most banks have FDIC specialists who can walk you through your account structure and confirm how much is protected. If your bank cannot answer clearly, that is a sign to move your money or restructure your accounts.

The FDIC website also has a bank search tool where you can look up any bank by name or location and confirm it is FDIC-insured. Not all banks are FDIC-insured—some credit unions are insured by the National Credit Union Administration (NCUA) instead, which has the same $250,000 limit but operates independently.

Frequently Asked Questions

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

Only $250,000 is covered. The remaining $50,000 is uninsured and at risk if the bank fails. To protect the full $300,000, you would need to move $50,000 to a different bank or restructure your accounts—for example, by opening a joint account with a family member at the same bank, which would give you a separate $250,000 limit.

Does FDIC coverage explore to money market accounts?

Yes, money market accounts are covered up to $250,000 per depositor, per bank, per ownership category, just like checking and savings accounts. However, money market mutual funds (which are different from money market accounts) are not covered by the FDIC.

If my bank is bought by another bank, do I lose FDIC coverage?

No. When one FDIC-insured bank buys another, the FDIC coverage continues without interruption. Your deposits remain insured up to $250,000 under the new owner. If the acquiring bank is not FDIC-insured, that would be unusual and would require you to move your money, but this almost never happens in practice.

Are joint accounts covered separately from individual accounts?

Yes. A joint account with your spouse is covered up to $250,000 as a separate category from an individual account in your name alone at the same bank. So you could have $250,000 in your name and $250,000 in a joint account at the same bank, and both would be fully covered.

What if I have multiple accounts at the same bank in my name?

All accounts in your name alone at the same bank share a single $250,000 limit. A checking account, savings account, and CD in your name at the same bank all count toward the same $250,000 total. If you have $150,000 in checking and $150,000 in savings, only $250,000 of the $300,000 total is covered.