Your money in a savings account is insured up to $250,000 per depositor per bank

The Federal Deposit Insurance Corporation (FDIC) insures deposits at member banks. If a bank fails, the FDIC pays you back up to $250,000 for each account you hold at that bank. This protection is automatic — you do not need to do anything to activate it, and it costs you nothing.

The $250,000 limit applies per depositor, per bank, per account category. If you have a savings account and a checking account at the same bank, they are added together and covered by one $250,000 limit. If you have accounts at two different banks, each bank's $250,000 limit is separate.

Money in a savings account is also protected from the bank's creditors. If the bank is sued or owes money to other parties, your deposits cannot be seized to pay those debts. The bank's assets and your deposits are legally separate.

Key Takeaways

  • FDIC insurance covers up to $250,000 per depositor per bank, and this protection is automatic at all member banks.
  • If you have more than $250,000 at one bank, the amount over $250,000 is not insured and would be at risk if the bank fails.
  • Money in a savings account is protected from creditors and lawsuits against the bank.
  • Savings accounts at credit unions are covered by a similar program called NCUA insurance, also up to $250,000 per account.
  • Your bank's investment products, such as stocks or mutual funds held in a brokerage account, are not covered by FDIC insurance.

How to check if your bank is FDIC insured

You can search the FDIC's Bank Find tool on their website to confirm your bank is a member. Type in your bank's name and your state. The search will show you the bank's official name, location, and the date it joined the FDIC.

Nearly all banks in the United States are FDIC members. The exceptions are very rare — some private banks and a small number of state-chartered banks do not carry FDIC insurance. If your bank is not listed in the FDIC database, contact your bank directly and ask whether it carries deposit insurance through another program.

What happens if your bank fails

When a bank fails, the FDIC takes over and pays depositors directly. The process usually takes a few days. You will receive a check or a deposit to a new account at another bank, depending on how the FDIC handles the closure.

The FDIC has a track record of paying depositors within days of a bank closure. You do not have to file a claim or provide proof of your balance — the FDIC has records of all deposits. If you have questions about your specific account after a closure, the FDIC will contact you with instructions.

When your money exceeds the $250,000 limit

If you have more than $250,000 at one bank, the amount over $250,000 is not insured. One strategy is to split your money across multiple banks, so each bank holds no more than $250,000 in your name. This way, all of your money stays insured.

Another option is to use different account categories at the same bank. A savings account, a checking account, and a money market account are three separate categories, and each has its own $250,000 limit. A joint account (held with another person) also has a separate $250,000 limit. Retirement accounts like IRAs have their own $250,000 limit as well. However, this strategy is complex and requires careful tracking — splitting money across banks is simpler for most people.

If you have a very large balance and want to keep it all at one bank, talk to the bank about sweep accounts or other products designed for high-balance customers. Some banks offer ways to structure accounts so that more of your money stays insured, though these arrangements vary by bank.

Savings accounts at credit unions

Credit unions are not banks, and their deposits are not covered by FDIC insurance. Instead, they are covered by the National Credit Union Administration (NCUA), a separate federal program. NCUA insurance works the same way as FDIC insurance — it covers up to $250,000 per member per credit union.

You can search the NCUA's credit union locator tool to confirm your credit union is insured. Like FDIC insurance, NCUA coverage is automatic and costs nothing.

What is not covered by deposit insurance

Deposit insurance covers money in savings accounts, checking accounts, money market accounts, and certificates of deposit (CDs). It does not cover stocks, bonds, mutual funds, or other investment products, even if you buy them through your bank.

If your bank has a brokerage division and you buy stocks or mutual funds through that division, those investments are held in a separate account and are not FDIC insured. They are instead protected by the Securities Investor Protection Corporation (SIPC), which is a different program with different limits. Safe deposit boxes and their contents are also not covered by FDIC insurance.

Interest earned on your deposits is covered by FDIC insurance as long as the total (principal plus interest) does not exceed $250,000.

How to keep your money safe beyond insurance

FDIC and NCUA insurance protect you from bank failure, but they do not protect you from theft, fraud, or your own mistakes. To reduce other risks, use strong passwords on your online banking account, never share your login information, and monitor your account regularly for unauthorized transactions.

If you notice a fraudulent charge or unauthorized withdrawal, contact your bank immediately. Banks are required to investigate and typically refund fraudulent transactions within a set timeframe, though the exact timeline depends on the type of fraud and your bank's policies.

Frequently Asked Questions

What if I have multiple savings accounts at the same bank?

Multiple savings accounts at the same bank are added together and covered by one $250,000 limit. If you have two savings accounts with $150,000 each at the same bank, only $250,000 is insured and $50,000 is not. To keep all your money insured, open accounts at different banks.

Does FDIC insurance cover money I owe the bank?

No. If you have a loan or credit card debt with the bank, the bank can use your deposits to pay off that debt before FDIC insurance applies. This is called a setoff right. To avoid this, keep deposits at a different bank from where you have loans.

Is my money insured if I have a joint account?

Yes. A joint account has its own $250,000 FDIC limit separate from your individual accounts. If you and your spouse each have $200,000 in a joint account, the full $400,000 is insured — $200,000 under each person's share of the limit.

What if my bank is bought by another bank?

When one bank buys another, deposits move to the new bank and remain insured. The $250,000 limit applies at the new bank going forward. If you had $250,000 at the old bank and $250,000 at the acquiring bank before the merger, you would now have $500,000 at one bank, and only $250,000 would be insured. Contact the new bank if you need to move money to stay within the limit.

Can I lose money in a savings account due to fees?

Yes, but not through FDIC insurance. Banks can charge monthly maintenance fees, overdraft fees, or other charges that reduce your balance. These fees are not covered by insurance — they are part of your account agreement with the bank. Read your account terms to understand what fees apply and how to avoid them.