E maximum fdic insurance a family of five can get

What is the FDIC?

The FDIC (Federal Deposit Insurance Corporation) is an independent agency of the United States government that protects you against the loss of your deposits if an FDIC-insured bank or savings association fails. FDIC insurance is backed by the full faith and credit of the United States government. Since the FDIC's creation in 1933, no depositor has ever lost even one penny of FDIC-insured deposits.

How can I check whether my bank is insured by FDIC?

Before using EDIE, use Bank Find or call toll-free 1-877-ASK-FDIC to make sure your bank or savings association is insured by the FDIC. The FDIC insures deposits in most, but not all, banks and savings associations. Deposits in separate branches of an insured bank are not separately insured. Deposits in one insured bank are insured separately from deposits in another insured bank. All FDIC-insured depository institutions must display an official FDIC sign at each teller window or teller station.

What types of accounts are eligible for FDIC insurance?

FDIC insurance covers all deposit accounts at insured banks and savings associations, including checking, NOW (Negotiable Order of Withdrawal) accounts, savings accounts, money market deposit accounts, and certificates of deposit (CDs) up to the insurance limit.

The FDIC does not insure the money you invest in stocks, bonds, mutual funds, life insurance policies, annuities, or municipal securities, even if you purchased these products from an insured bank or savings association.

How can I keep my deposits within FDIC insurance limits?

If you and your family have $250,000 or less in all of your deposit accounts at the same insured bank or savings association, you do not need to worry about your insurance coverage — your deposits are fully insured. A depositor can have more than $250,000 at one insured bank or savings association and still be fully insured provided the accounts meet certain requirements. In addition, federal law provides for insurance coverage of up to $250,000 for certain retirement accounts.

What are the basic FDIC coverage limits?*

Single Accounts (owned by one person with no beneficiaries): $250,000 per owner

Joint Accounts (two or more persons with no beneficiaries): $250,000 per co-owner

IRAs and other certain retirement accounts: $250,000 per owner

Revocable trust accounts: Each owner is insured up to $250,000 for each unique eligible beneficiary named or identified in the revocable trust, subject to specific limitations and requirements

*These deposit insurance coverage limits refer to the total of all deposits that account owners have at each FDIC-insured bank. The listing above shows only the most common ownership categories that apply to individual and family deposits, and assumes that all FDIC requirements are met.

Is it possible to have more than $250,000 at one insured bank and still be fully covered?

You may qualify for more than $250,000 in coverage at one insured bank or savings association if you own deposit accounts in different ownership categories. The most common account ownership categories for individual and family deposits are single accounts, joint accounts, revocable trust accounts, and certain retirement accounts.

What is a single account?

This is a deposit account owned by one person and titled in that person's name only, with no beneficiaries. All of your single accounts at the same insured bank are added together and the total is insured up to $250,000. For example, if you have a checking account and a CD at the same insured bank, and both accounts are in your name only, the two accounts are added together and the total is insured up to $250,000. Note that retirement accounts and trust accounts are not included in this ownership category.

What is a joint account?

This is a deposit account owned by two or more people and titled jointly in the co-owners' names only, with no beneficiaries. If all co-owners have equal rights to withdraw money from a joint account, a co-owner's shares of all joint accounts at the same insured bank are added together and the total is insured up to $250,000. Note that jointly owned revocable trust accounts are not included in this ownership category.

If a couple has a joint money market deposit account, a joint savings account, and a joint CD at the same insured bank, each co-owner's shares of the three accounts are added together and insured up to $250,000 per owner, providing up to $500,000 in coverage for the couple's joint accounts.

Example: John and Mary have three joint accounts totaling $600,000 at an insured bank. Under FDIC rules, each co-owner's share of each joint account is considered equal unless otherwise stated in the bank's records. John and Mary each own $300,000 in the joint account category, putting a total of $100,000 ($50,000 for each) over the insurance limit.

• Mary's ownership share in all joint accounts equals $300,000 [1/2 of the MMDA ($25,000) plus 1/2 of the savings account ($75,000) plus 1/2 of the CD ($200,000), for a total of $300,000]. Since her coverage in the joint ownership category is limited to $250,000, $50,000 is uninsured.
• John's ownership share in all joint accounts is the same as Mary's, so $50,000 is uninsured.

What is meant by certain retirement accounts?

These are deposit accounts owned by one person and titled in the name of that person's retirement plan. The following types of retirement plans are insured in this ownership category:

• Individual Retirement Accounts (IRAs) including traditional IRAs, Roth IRAs, Simplified Employee Pension (SEP) IRAs, and Savings Incentive Match Plans for Employees (SIMPLE) IRAs
• Section 457 deferred compensation plan accounts (whether self-directed or not)
• Self-directed defined contribution plan accounts, such as self-directed 401(k) plans, self-directed SIMPLE IRA held in the form of a 401(k) plan, self-directed defined contribution money purchase plans, or self-directed defined contribution profit-sharing plans
• Self-directed Keogh plan (or H.R. 10 plan) accounts

All deposits that an individual has in any of the types of retirement plans listed above at the same insured bank are added together and the total is insured up to $250,000. For example, if an individual has an IRA and a self-directed Keogh account at the same bank, the deposits in both accounts would be added together and insured up to $250,000.

Note: Naming beneficiaries on a retirement account does not increase deposit insurance coverage.

What is a revocable trust account?

A revocable trust account is a deposit account owned by one or more people that identifies one or more beneficiaries who will receive the deposits upon the death of the owner(s). A revocable trust can be revoked, terminated, or changed at any time, at the discretion of the owner(s). The term "owner" means the grantor, settlor, or trustor of the revocable trust.

This ownership category includes both informal and formal revocable trusts:

• Informal revocable trusts — also known as payable on death (POD), in trust for (ITF), testamentary, or Totten Trust accounts — are the most common form of revocable trusts. These informal revocable trusts are created when the account owner signs an agreement — usually part of the bank's signature card — stating that the deposits will be payable to one or more beneficiaries upon the owner's death.
• Formal revocable trust — also known as Living trusts or family trusts — are formal revocable trusts created for estate planning purposes. The owner of a formal revocable trust controls the deposits in the trust during his or her lifetime. The trust document sets forth who shall receive trust assets after the death of the owner.

Deposit insurance coverage for revocable trust accounts is provided to the owner of the trust. However, the amount of coverage is based on the number of beneficiaries named in the trust and, in some cases, the interests allocated to those beneficiaries, up to the insurance limit. A trust beneficiary can be an individual (regardless of the relationship to the owner), a charity, or a non-profit organization (as defined by the IRS).

Revocable trust coverage is based on all revocable trust deposits held by the same owner at the same bank, whether formal or informal. If a revocable trust account has more than one owner, each owner's coverage is calculated separately, using the following rules:

• Revocable Trust Deposits with Five or Fewer Beneficiaries — Each owner's share of revocable trust deposits is insured up to $250,000 for each unique eligible beneficiary named or identified in the revocable trust (i.e., $250,000 times the number of different beneficiaries), regardless of actual interest provided to beneficiaries.
• Revocable Trust Deposits with Six or More Beneficiaries — Each owner's share of revocable trust deposits is insured for the greater of either (1) coverage based on each unique eligible beneficiary's actual interest in the revocable trust deposits, with no beneficiary's interest to be insured for more than $250,000, or (2) $1,250,000.

Note: Determining coverage for revocable trust accounts that have six or more beneficiaries and provide different interests for the trust beneficiaries can be complicated. Contact the FDIC at 1-877-275-3342 if you need assistance in determining the insurance coverage of your revocable trust.

POD Account Example: Bill has a $250,000 POD account with his wife Sue as beneficiary. Sue has a $250,000 POD account with Bill as beneficiary. In addition, Bill and Sue jointly have a $1,500,000 POD account with their three children as beneficiaries.

These three accounts totaling $2,000,000 are fully insured because each owner is entitled to $250,000 of coverage for each beneficiary. Bill has $1,000,000 of insurance coverage because he names four beneficiaries — his wife in the first account and his three children in the third account. Sue also has $1,000,000 of insurance coverage — $250,000 for each of her beneficiaries — her husband in the second account and her three children in the third account.

When calculating coverage for revocable trust accounts, keep in mind that:

• Coverage is based on the number of beneficiaries (and, if the account has six or more beneficiaries, the interests of the beneficiaries) named by each owner. Additional coverage is not provided for the trust owner(s). For example, if a father owns a $750,000 POD account naming his two sons as beneficiaries, the father's account is insured for $500,000 because he is entitled to $250,000 of deposit insurance coverage for each unique eligible beneficiary he has named in the account. The remaining $250,000 is uninsured. A common misconception is that deposit insurance is determined by counting or adding the total number of individuals listed on a POD account. Coverage is NOT calculated as owners plus beneficiaries times $250,000.
• FDIC insurance limits apply to all revocable trust deposits — including all POD/ITF and formal revocable trust accounts — that a trust owner has at one insured bank. In applying the $250,000 per beneficiary insurance limit, the FDIC combines an owner's POD accounts with the formal revocable trust accounts that name the same beneficiaries at the same bank.

More in-depth information on types of deposit accounts

• Single Accounts
• Certain Retirement Accounts
• Joint Accounts
• Revocable Trust Accounts
• Irrevocable Trust Accounts
• Employee Benefit Plan Accounts
• Corporation, Partnership, and Unincorporated Association Accounts
• Government Accounts

1. What is a single account?
   A single account is a deposit account owned by one person, with no beneficiaries. Such accounts include deposits titled in the owner's name alone, deposits established for the benefit of the owner by an agent, nominee, guardian, custodian, or conservator, and deposits belonging to the owner of a sole proprietorship.
2. How are single accounts insured?
   All single accounts established by, or for the benefit of, the same person are added together. The total is insured up to a maximum of $250,000, including principal and interest.

Certain Retirement Accounts

1. What are certain retirement accounts?
   These are deposit accounts owned by one person and titled in the name of that person's:
   • Individual Retirement Account including traditional IRA, Roth IRA, Simplified Employee Pension (SEP) IRA or Savings Incentive Match Plans for Employees (SIMPLE) IRA
   • Section 457 deferred compensation plan account (such as eligible deferred compensation plans provided by state and local governments regardless of whether the plan is self-directed)
   • Self-directed defined contribution plan account, such as a self-directed 401(k) plan, a self-directed SIMPLE plan held in the form of a 401(k) plan, a self-directed defined contribution money purchase plan, or a self-directed defined contribution profit-sharing plan
   • Self-directed Keogh plan account (or H.R. 10 plan account) designed for self-employed individuals
2. What is the definition of self-directed?
   The FDIC defines the term "self-directed" to mean that plan participants have the right to direct how the money is invested, including the ability to direct that the deposits be placed at an FDIC-insured bank.

If a participant of a retirement plan has the right to choose a particular depository institution's deposit accounts as an investment, the FDIC would consider the account to be self-directed. Also, if a plan has as its default investment option deposit accounts at a particular FDIC-insured institution, the FDIC would deem the plan to be self-directed for deposit insurance purposes because, by inaction, the participant has directed the placement of such deposits.

1. What is a joint account?
   A joint account is a deposit account owned by two or more individuals, with no beneficiaries. Federal deposit insurance covers joint accounts owned in any manner conforming to applicable state law, such as joint tenants with a right of survivorship, tenants by the entirety, and tenants in common.
2. What are the requirements for joint accounts?
   Joint accounts are insured separately from other ownership categories if all of the following conditions are met:
   • All co-owners must be natural persons. This means that legal entities such as corporations or partnerships are not eligible for joint account deposit insurance coverage.
   • Each of the co-owners must have personally signed a deposit account signature card. The execution of an account signature card is not required for certificates of deposit, deposit obligations evidenced by a negotiable instrument, or accounts maintained by an agent, nominee, guardian, custodian, or conservator, but the deposit must in fact be jointly owned.
   • Each of the co-owners must have equal rights to withdraw deposits from the account.
   For example, if one co-owner can withdraw funds on his or her signature alone, but the other co-owner can withdraw funds only on the signature of both co-owners, then this requirement has not been satisfied; the co-owners do not have equal withdrawal rights. Likewise, if a co-owner's right to withdraw funds is limited to a specified dollar amount, the funds in the account will be allocated between the co-owners according to their withdrawal rights and insured as single account funds. For example, if $250,000 is deposited in the names of A and B, but A has the right to withdraw only up to $50,000 from the account, $50,000 is allocated to A and the remainder ($200,000) is allocated to B. The funds, as allocated, are then added to any other single account funds of A or B, respectively.
3. How are joint accounts insured?
   An individual's (co-owner's) interests in all qualifying joint accounts are added together and the total is insured up to the $250,000 maximum. Each co-owner's interest (or share) in a joint account is deemed equal. The balance of a joint account can exceed $250,000, as long as no owner's share of joint accounts at the same bank exceeds $250,000. The use of different Social Security numbers does not determine insurance coverage, nor does rearranging the owners' names, changing the style of the names, or using "or" rather than "and" to join the owners' names in a joint account title.

Each owner's ownership interests in these four joint accounts follow:

A's ownership interest in the joint account category is $285,000. This amount is more than the $250,000 maximum, so $250,000 is insured and $35,000 is uninsured.

B's ownership interest in the joint account category is $245,000. That amount is less than the $250,000 maximum, so B is fully insured.

C's ownership interest in the joint account category is $60,000. That amount is less than the $250,000 maximum, so C is fully insured.

D's ownership interest in the joint account category is $40,000. That amount is less than the $250,000 maximum, so D is fully insured.

Revocable Trust Accounts

1. What is a revocable trust account?
   A revocable trust account is a deposit account that indicates an intention that the funds will belong to one or more beneficiaries upon the death of the owner (grantor/settlor/trustor). There are both informal and formal revocable trusts:
   • Informal revocable trusts — often called payable on death (POD), Totten trust, or in trust for (ITF) accounts — are created when the account owner signs an agreement, usually part of the bank's signature card, stating that the funds are payable to one or more beneficiaries upon the owner's death.
   • Formal revocable trusts — known as living or family trusts — are written trusts created for estate planning purposes. The owner (also known as a grantor, settlor or trustor) controls the funds in the trust during his or her lifetime and reserves the right to revoke the trust.
2. How are revocable trust accounts insured?
   Deposit insurance coverage for revocable trust accounts is provided to the owner of the trust. However, the amount of coverage is based on the number of beneficiaries named in the trust and, in some cases, the interests allocated to those beneficiaries, up to the insurance limit. A trust beneficiary can be an individual (regardless of the relationship to the owner), a charity, or a non-profit organization (as defined by the IRS).

• Revocable Trust Deposits with Five or Fewer Beneficiaries — Each owner's share of revocable trust deposits is insured up to $250,000 for each unique eligible beneficiary (i.e., $250,000 times the number of unique eligible beneficiaries), regardless of the actual interests of the beneficiaries.
• Revocable Trust Deposits with Six or More Beneficiaries — Each owner's share of revocable trust deposits is insured for the greater of either (1) the coverage based on each unique eligible beneficiary's actual interest in the revocable trust deposits, with no beneficiary's interest to be insured for more than $250,000, or (2) $1,250,000.

Explanation: All but one account is fully insured. The account naming the one grandchild is insured to $500,000 because each owner is entitled to $250,000 insurance coverage for the sole beneficiary.

• An individual has $750,000 in revocable trust deposits at one FDIC-insured bank. The trust document specifies that 60% goes to one child, 30% goes to a second child, and 10% to a third child. The full balance of the trust is insured, because the owner receives coverage of $250,000 per beneficiary, regardless of the actual interests set forth in the trust document.

• An individual has $1,400,000 in revocable trust deposits at one FDIC-insured bank. The trust document specifies that 50% of the funds will belong to the owner's son and 10% will belong to each of his five grandchildren. Maximum coverage for this depositor's funds is the greater of (1) the coverage based on each beneficiary's actual interest in the revocable trust deposits, with no beneficiary's interest exceeding $250,000, or (2) $1,250,000. In determining the deposit insurance coverage, we first must calculate the coverage based on actual interests:
  • The amount attributable to the first beneficiary is $700,000 ($1,400,000 X 50%). Of this amount $250,000 is insured and $450,000 is uninsured.
  • The amount attributable to each of the 5 remaining beneficiaries is $140,000 ($1,400,000 X 10%). Since the amount going to each remaining beneficiary is less than $250,000, this portion is fully insured.
  • Based on actual interests, the owner is insured for $950,000, leaving $450,000 uninsured.

  Revocable Trust Deposits $1,400,000
  Beneficiary	Beneficiary Interest	Allocated Amount	Insured Amount	Uninsured Amount
  Son	50%	$700,000	$250,000	$450,000
  GC1	10%	$140,000	$140,000	$0
  GC2	10%	$140,000	$140,000	$0
  GC3	10%	$140,000	$140,000	$0
  GC4	10%	$140,000	$140,000	$0
  GC5	10%	$140,000	$140,000	$0
  Total	100%	$1,400,000	$950,000	$450,000

  • The amount attributable to each of the first 5 beneficiaries is $250,000 ($2,500,000 X10% (each child's share)). Since this amount is at the maximum coverage an owner can receive per beneficiary, the deposits attributable to these beneficiaries are fully insured. The amount attributable to each of the remaining 10 beneficiaries is $125,000 ($2,500,000 X 5% (each grandchild's share)). Since this amount is less than the $250,000 per-beneficiary limit, the deposits attributable to the remaining beneficiaries are also fully insured.
  • A husband creates a formal revocable trust giving his wife a life estate interest in the trust assets, with the remaining assets to belong equally to the couple's two children upon both parent's death. Deposits held in the name of this trust would be insured up to $750,000 ($250,000 for each beneficiary — the wife and two children).
  • A father has a POD account with a balance of $400,000 naming his son and daughter as beneficiaries. He also has a formal revocable trust account with a balance of $200,000 naming the same beneficiaries. The funds in both accounts would be added together and $300,000 would be attributable as the beneficial interest of each child. Therefore, the two accounts together would be insured for $500,000 ($250,000 per beneficiary) and uninsured for $100,000.

  Irrevocable Trust Accounts

  What is an irrevocable trust?
  Irrevocable trust accounts are deposit accounts held by a trust established by statute or a written trust agreement, in which the creator of the trust (grantor/settlor/trustor) contributes funds or property and gives up all power to cancel or change the trust.

  • Those created following of the death of an owner of a revocable trust. The insurance coverage of these irrevocable trusts may continue to be insured under the rules for revocable trusts, which are described above. Please contact the FDIC at 1-877-275-3342 for further information.
  • Those that are initially created as an irrevocable trust (usually by a court order or established under a will) and are not derived from a revocable trust. The insurance coverage of these irrevocable trusts is described below.
  • The insured bank's deposit account records must disclose the existence of the trust relationship
  • The beneficiaries and their interests in the trust must be identifiable from the deposit account records of the bank or from the records of the trustee
  • The amount of each beneficiary's interest must not be "contingent" as that term is defined by FDIC regulations
  • The trust must be valid under state law

  Employee Benefit Plan Accounts

  1. Please note that EDIE does not compute the deposit insurance coverage for Employee Benefit Plan Accounts. For the deposit insurance coverage for Employee Benefit Plan Accounts, please contact the FDIC at 1-877-275-3342.
  2. What is the deposit insurance coverage for employee benefit plans, such as pension plans and profit-sharing plans?
     An employee benefit plan account is a deposit of a pension plan, profit-sharing plan, defined benefit plan, or other employee benefit plan that is not self-directed. Employee benefit plan deposits that qualify for "pass-through coverage" are insured up to $250,000 for each participant's interest in the plan. In order for a pension or profit-sharing plan to receive pass-through insurance, the institution's deposit account records must specifically disclose the fact that the funds are owned by an employee benefit plan. In addition, the details of the participants' beneficial interests in the account must be ascertainable from the institution's deposit account records or from the records that the plan administrator (or some other person or entity that has agreed to maintain records for the plan) maintains in good faith and in the regular course of business.
  3. Is employee benefit plan coverage based on the number of plan participants?
     Coverage for an employee benefit plan's deposits is based on each participant's share of the plan. Because plan participants normally have different interests in the plan, insurance coverage cannot be determined by simply multiplying the number of participants by $250,000. To determine the maximum amount a plan can have on deposit in a single bank and remain fully insured, first determine which participant has the largest share of the plan assets, then divide $250,000 by that percentage. For example, if a plan has 20 participants, but one participant has an 80% share of the plan assets, the most the plan can have on deposit in a single bank and still remain fully insured is $312,500 ($250,000/.80 = $312,500).

  Example — Employee Benefit Plan that Qualifies for Pass-Through Coverage
  Account Title				Balance
  Happy Pet Clinic Benefit Plan				$700,000
  Plan Participants	Plan Share	Share of Deposit	Amount Insured	Amount Uninsured
  Dr. Todd	35%	$245,000	$245,000	$0
  Dr. Jones	30%	$210,000	$210,000	$0
  Tech Evans	20%	$140,000	$140,000	$0
  Tech Barnes	15%	$105,000	$105,000	$0
  Plan Total	100%	$700,000	$700,000	$0

  Corporation, Partnership, and Unincorporated Association Accounts

  1. What are corporations, partnerships and unincorporated association accounts?
     These are accounts established by businesses and organizations — including for-profit and not-for-profit organizations — engaged in an independent activity, meaning that the entity is operated primarily for some purpose other than to increase insurance coverage.
  2. What are unincorporated associations?
     Unincorporated associations typically include religious, community and civic organizations, and social clubs that are not incorporated.
  3. What is the deposit insurance coverage for funds deposited by a corporation, partnership, or unincorporated association?
     Funds deposited by a corporation, partnership, or unincorporated association are insured up to a maximum of $250,000. Funds deposited by a corporation, partnership, or unincorporated association are insured separately from the personal accounts of the stockholders, partners, or members. To qualify for this coverage, the entity must be engaged in an independent activity, meaning that the entity is operated primarily for some purpose other than to increase deposit insurance.
  4. Is there any way that a business can qualify for additional insurance coverage?
     No, there is no way that a corporation, partnership, or unincorporated association can qualify for more than $250,000 in deposit insurance coverage for its deposits at one bank. Separate accounts owned by the same entity, but designated for different purposes, are not separately insured. Instead, such accounts are added together and insured up to $250,000. If a corporation has divisions or units that are not separately incorporated, the deposit accounts of those divisions or units will be added to any other deposit accounts of the corporation for purposes of determining deposit insurance coverage.
  5. Does the number of partners, members, or account signatories increase deposit insurance coverage?
     The number of partners, members, or account signatories that a corporation, partnership, or unincorporated association has does not affect coverage. For example, deposits owned by a homeowners association are insured up to $250,000 in total, not $250,000 for each member of the association.
  6. How are deposits of a sole proprietorship insured?
     Deposits owned by a business that is a sole proprietorship are not insured under this category. Rather, they are insured as the single account deposits of the person who is the sole proprietor. Funds deposited in the sole proprietorship's name are added to any other single accounts of the sole proprietor and the total is insured to a maximum of $250,000.
  1. What are government accounts?
     Government accounts are also known as public unit accounts. This category includes deposit accounts of the United States, any state, county, municipality (or a political subdivision of any state, county, or municipality), the District of Columbia, Puerto Rico, and other government possessions and territories, or an Indian tribe.
  2. How are public unit accounts insured?
     Insurance coverage of a public unit account differs from a corporation, partnership, or unincorporated association account in that the coverage extends to the official custodian of the funds belonging to the public unit rather than the public unit itself. The insurance coverage of public unit accounts depends upon (1) the type of deposit, and (2) the location of the insured depository institution.
  3. Beginning on January 1, 2013

  Accounts held by an official custondian for a government unit will be insured as follows:

  • Up to $250,000 for the combined amount of all time and savings accounts (including NOW accounts) and
  • Up to $250,000 for all demand deposit accounts (interest-bearing and non-interest bearing).
  • Up to $250,000 for the combined total of all deposit accounts.
  • The creation of the subdivision or department has been expressly authorized by the law of such public unit;
  • Some functions of government have been delegated to the subdivision or department by such law; and
  • The subdivision or department is empowered to exercise exclusive control over funds for its exclusive use.