Your deposits are insured up to $250,000 per account owner at FDIC banks

A savings account at a bank insured by the Federal Deposit Insurance Corporation (FDIC) is protected if the bank fails. The FDIC guarantees your money up to $250,000 per depositor, per bank, per account ownership category. This means if you have $50,000 in a savings account and the bank goes under, you get your $50,000 back. If you have $300,000, you get $250,000 back and lose the rest.

The FDIC has been insuring deposits since 1933. No depositor has lost a single dollar of FDIC-insured funds in that time. The insurance is backed by the full faith and credit of the U.S. government, not by the bank itself. You do not pay a premium for this coverage — it is built into how the FDIC operates.

Credit unions offer the same protection through the National Credit Union Administration (NCUA), which insures deposits up to $250,000 under the same rules. If you use both a bank and a credit union, each institution's coverage is separate.

Key Takeaways

  • FDIC insurance covers up to $250,000 per depositor per bank, so accounts over that amount carry uninsured risk.
  • The coverage applies only if the bank fails — it does not protect against fraud, theft by the bank, or your own mistakes.
  • You can increase your total insured amount by spreading money across multiple banks or by using different account ownership categories at the same bank.
  • Credit unions use NCUA insurance instead of FDIC, but the $250,000 limit and rules work the same way.
  • Online banks and traditional banks have identical FDIC protection as long as they are FDIC-insured.

What FDIC insurance does and does not cover

FDIC insurance protects your money only if the bank itself fails and closes. It does not cover losses from fraud, theft, or your own error. If a scammer convinces you to wire money out of your account, the FDIC will not reimburse you. If a bank employee steals from your account, you may have a claim against the bank itself, but the FDIC is not involved.

The insurance also does not cover investment losses. If your bank sells you stocks, bonds, or mutual funds and they lose value, that loss is yours to bear. The FDIC only insures deposits — money you put into a savings account, checking account, or money market account at the bank.

Certain account types are not covered at all. Safe deposit boxes, for example, are not FDIC-insured. If you store jewelry or documents in a safe deposit box and the bank fails, the FDIC does not reimburse you. Cashier's checks and traveler's checks issued by the bank are also not covered.

How to check if your bank is FDIC-insured

You can search for your bank on the FDIC's official website using their Bank Find tool. Go to fdic.gov, click on "Bank Find," and enter your bank's name or the city where you opened your account. The search will tell you whether the bank is FDIC-insured and show you the exact coverage limits for each account you hold there.

Your bank statements and account documents should also display the FDIC logo or a statement that your account is FDIC-insured. If you do not see this language and the Bank Find tool does not list your bank, contact the bank directly and ask whether it is FDIC-insured. If it is not, your money has no federal insurance protection.

Most mainstream banks and credit unions are insured. The risk of finding an uninsured institution is low, but it happens — some online banks and very small local banks operate without FDIC or NCUA coverage.

Spreading money across banks to increase coverage

If you have more than $250,000 to save, you can open accounts at multiple FDIC-insured banks and keep each account under $250,000. Each bank's coverage is separate, so $200,000 at Bank A and $200,000 at Bank B are both fully insured. This strategy works because the FDIC counts coverage per bank, not per person.

You can also increase coverage at a single bank by using different account ownership categories. A savings account in your name alone is covered up to $250,000. A joint savings account with your spouse is covered up to $250,000 as a separate category. A savings account held in trust for your child is another separate category, also covered up to $250,000. Some banks allow you to set up multiple categories at the same institution.

The FDIC website has a Coverage Calculator that shows you exactly how much of your money is insured based on how you own each account. Use it before you deposit large sums to make sure you understand where your coverage ends.

What happens when a bank fails

When an FDIC-insured bank fails, the FDIC steps in and either arranges for another bank to take over the failed bank's deposits or pays depositors directly. In most cases, the takeover happens over a weekend and you wake up Monday with access to your money through a new bank. You do not have to do anything — your account simply transfers.

If no bank takes over the deposits, the FDIC mails you a check for the insured amount within a few days. This has happened rarely in recent decades. The last time a major bank failure occurred was in 2008 during the financial crisis, and even then, most depositors received their money within days.

You keep full access to your money during the process. You can withdraw cash, use your debit card, and write checks as normal. The FDIC does not freeze accounts when a bank fails.

Risks that are not covered by FDIC insurance

Your savings account is vulnerable to fraud and theft in ways the FDIC does not protect against. If someone gains access to your online banking login and transfers money out, you may be able to recover it through your bank's fraud department, but the FDIC does not reimburse you. If you give your account number to a scammer who poses as your bank, that is your loss.

Cybersecurity breaches at the bank itself are also not FDIC-covered. If hackers steal your account information and drain your balance, the bank may reimburse you under its own fraud policy, but the FDIC is not involved. This is why it matters whether your bank has strong security practices and whether you use a strong password and two-factor authentication.

Negative interest rates are not a risk in the United States, but very low interest rates mean your money loses purchasing power over time. A savings account earning 0.01% per year while inflation runs at 3% means your money is worth less each year, even though the FDIC says it is safe. This is not a bank failure risk — it is an inflation risk that no insurance covers.

Frequently Asked Questions

What if I have more than $250,000 and want to keep it all at one bank?

You can open multiple accounts in different ownership categories at the same bank. A savings account in your name, a joint account with your spouse, and a trust account for your child are three separate coverage buckets, each insured up to $250,000. The FDIC Coverage Calculator on their website shows you exactly how to structure this.

Are online banks as safe as traditional banks?

Online banks are just as safe if they are FDIC-insured, which most major ones are. The FDIC does not distinguish between online and brick-and-mortar banks. Check the Bank Find tool to confirm your online bank is insured. Online banks often offer higher interest rates because they have lower overhead costs, not because they are riskier.

If I have money in a savings account and a checking account at the same bank, are they both covered?

Yes, but they count as one coverage limit. A savings account and a checking account at the same bank, both in your name, share the $250,000 limit. If you have $150,000 in savings and $120,000 in checking, only $250,000 total is insured and $20,000 is uninsured. Open the second account at a different bank if you want separate coverage.

Does FDIC insurance cover money I lose to a scam?

No. FDIC insurance only covers bank failure, not fraud or theft. If you send money to a scammer or give your account number to someone who drains it, the FDIC does not reimburse you. Your bank may have its own fraud protection that covers some losses, so report the fraud to your bank immediately.

What if my bank is not FDIC-insured?

Your deposits have no federal insurance protection. If the bank fails, you lose your money. Before opening an account, use the FDIC Bank Find tool to confirm the bank is insured. If it is not, consider moving your money to an FDIC-insured bank.