Yes, most traditional savings accounts at banks are FDIC insured up to $250,000 per depositor per bank
FDIC insurance covers money you deposit in a savings account at a bank that holds FDIC membership. The coverage limit is $250,000 per person, per bank, per account category. If you have $300,000 in a savings account at one bank, the FDIC covers $250,000 and you lose the rest if the bank fails.
The key word is bank. Credit unions use a different insurance system called NCUA. Investment firms, money market funds, and brokerage accounts are not FDIC insured. Online banks are FDIC insured if they are chartered banks and hold FDIC membership — most major ones do, but you need to verify.
FDIC insurance is automatic. You do not need to sign up, pay a fee, or do anything. If your bank fails, the FDIC pays you directly. The process usually takes a few weeks to a few months depending on how many accounts the failed bank held.
Key Takeaways
- FDIC insurance covers up to $250,000 per person per bank in a savings account, and the coverage is automatic with no action required from you.
- The $250,000 limit resets for each separate bank, so you can have $250,000 at Bank A and another $250,000 at Bank B and both are fully covered.
- Online banks are FDIC insured if they are chartered banks, which most major ones are, but you should confirm on the bank's website or by calling.
- Credit unions are not FDIC insured; they use NCUA insurance instead, which works similarly but is a separate system.
- Money in savings accounts held jointly with another person counts as a separate account category, so joint accounts have their own $250,000 limit.
How the $250,000 limit works across multiple accounts
The $250,000 FDIC limit applies per depositor, per bank, per account category. That means if you have multiple savings accounts at the same bank, they are added together and covered as one account up to $250,000 total. If you have $150,000 in one savings account and $120,000 in another savings account at the same bank, only $250,000 is covered — you lose $20,000.
However, if you have $250,000 at Bank A and $250,000 at Bank B, both are fully covered because they are at different banks. The FDIC tracks coverage by bank, not by how many banks you use. This is why people with large amounts of money sometimes split deposits across multiple banks.
Joint accounts are treated as a separate category. If you and your spouse have a joint savings account with $300,000, the FDIC covers $250,000 of that joint account. If you also have your own individual savings account at the same bank with $100,000, that individual account is covered separately up to $250,000. The joint account and individual account do not combine toward the same limit.
Which account types count toward the $250,000 limit
Savings accounts, money market deposit accounts, and checking accounts all count toward the same $250,000 limit at each bank. If you have $100,000 in a savings account, $80,000 in a checking account, and $90,000 in a money market account at the same bank, the FDIC covers $250,000 total across all three — you lose $20,000.
Certificates of deposit (CDs) are treated as a separate category. A CD at the same bank has its own $250,000 limit. So you could have $250,000 in savings accounts and $250,000 in CDs at the same bank and both are fully covered.
Retirement accounts like IRAs and SEP-IRAs are also separate categories with their own $250,000 limits. A traditional IRA at your bank is covered separately from your savings account at the same bank.
How to verify your bank is FDIC insured
The easiest way to check is to visit the FDIC's official bank search tool at banks.fdic.gov. Type in your bank's name and it will show you whether it holds FDIC membership, which branches are covered, and any recent enforcement actions.
You can also call your bank directly and ask whether it is FDIC insured. Most banks will tell you immediately. If a bank hesitates or says it is not FDIC insured, that is a red flag — it means your deposits are not protected by federal insurance.
Online banks should display FDIC insurance information on their website, usually in the footer or in a section about safety. Look for language like "FDIC insured" or "member FDIC." If you cannot find it, search the bank's name on the FDIC website or call the bank to confirm.
What happens if your bank fails
If your bank fails, the FDIC takes over and pays you the amount you are owed up to $250,000. The FDIC does not transfer your account to another bank automatically — instead, it sends you a check or deposits the money into an account you specify.
The process usually takes two to twelve weeks depending on how complex the bank's records are. During this time, you cannot access your money. The FDIC will contact you by mail at the address on file with your bank, so make sure your bank has your current address.
If you had more than $250,000 at the failed bank, you become an unsecured creditor for the amount over $250,000. This means you may recover some of that money eventually, but it is not may provide and the process can take years. Most people in this situation recover little or nothing.
Account categories that have separate coverage limits
| Account Category | Coverage Limit | Notes |
|---|---|---|
| Single accounts (savings, checking, money market) | $250,000 per bank | All three types combined count toward one limit |
| Joint accounts | $250,000 per bank | Separate from individual accounts at the same bank |
| Certificates of Deposit (CDs) | $250,000 per bank | Separate category from savings and checking |
| Traditional IRA | $250,000 per bank | Separate from non-retirement accounts |
| SEP-IRA or Solo 401(k) | $250,000 per bank | Separate from other retirement accounts |
| Revocable trust accounts | $250,000 per beneficiary per bank | Coverage depends on number of named beneficiaries |
What is not covered by FDIC insurance
Stocks, bonds, mutual funds, and investment accounts are not FDIC insured, even if you hold them at a bank. If your bank has a brokerage arm and you buy stocks through it, those stocks are not protected by FDIC insurance. They may be protected by SIPC (Securities Investor Protection Corporation) insurance instead, but that is a different system with different limits.
Safe deposit boxes are not FDIC insured. If you keep cash, jewelry, or documents in a safe deposit box at your bank and the bank fails, the FDIC does not cover the contents. Some banks offer their own insurance for safe deposit box contents, but you need to ask about that separately.
Money you owe the bank — such as a loan balance or credit card debt — is not covered. FDIC insurance only protects deposits you have made to the bank, not money the bank owes you in the form of credit.
Frequently Asked Questions
If I have $500,000, how do I make sure all of it is FDIC insured?
Split the money across two banks. Put $250,000 at Bank A and $250,000 at Bank B. Each bank's deposit is fully covered. You can open accounts at as many banks as you need to cover the full amount. The FDIC limit resets for each separate bank.
Does FDIC insurance cover money I transfer out of my account?
No. FDIC insurance only covers money that is actually in your account at the bank. Once you transfer money out, it is no longer the bank's responsibility and is not covered by FDIC insurance. If you transfer money to another bank, that bank's FDIC insurance covers it instead.
Are online savings accounts FDIC insured?
Most major online banks are FDIC insured because they are chartered banks. However, not all online financial companies are banks — some are brokerages or fintech companies that are not FDIC insured. Check the company's website or search the FDIC bank database to confirm before opening an account.
What if my bank is FDIC insured but fails anyway?
The FDIC pays you up to $250,000 automatically. You do not need to do anything except wait for the FDIC to contact you. The FDIC will send you a check or deposit the money into an account you specify. The process usually takes a few weeks to a few months.
Can I lose money if my bank is FDIC insured?
Only if you have more than $250,000 at that bank. The amount over $250,000 is not covered. You can also lose money if you hold investments, stocks, or bonds at the bank — those are not FDIC insured even if your savings account is.