FDIC Account Insurance Limits Raised Temporarily

As part of the Emergency Economic Stabilization Act of 2008, the level of FDIC insurance coverage has increased as of October 3rd to $250,000. As I noted in an earlier post, it’s possible to have much more than $250,000 of coverage at the same bank, because the coverage depends on the titling of the account.

For example, if a husband and wife each have an IRA and an individual account, and the two also a joint account at the same FDIC-insured bank, their deposits are insured to the follow limits:

Husband:
Single-owner account – $250,000
Joint-owner account -$250,000
IRA -$250,000

Wife:
Single-owner account – $250,000
Joint-owner account -$250,000
IRA -$250,000

Together this couple could have up to $1.5 MM in the same bank and the full amount would be FDIC-insured.

According to the FDIC website, these new insurance limits are in place until December 31, 2009.  Unless further legislative changes are enacted, I assume the FDIC insurance limits would return to their previous levels at the end of 2009.

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Thomas Fisher, CFP®

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