September 17th, 2008 
NCN
The FDIC has a new website – MyFDICInsurance.Gov – where you can check to see if your savings and checking deposits are fully insured. They also have some public service ads – starring Suze Orman and FDIC chairman, Shelia Bair, explaining FDIC insurance and how the new site works. Or, you can just skip the landing page and visit the main site, where you can enter the names of the financial institutions with which you do business, a few details about your current balances, and the types of accounts you have. The site will tell you what types of accounts are insured, and how much of your money is covered.
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Don’t you mean “LOSE” your deposits? I’m not sure how deposits could be loose or tight.
HA! I’ll correct it… thanks for the heads up…
NCN
Good post! This is a good place for those who are nervous.
I don’t know, I think it makes me more nervous that a huge Suze Orman is smiling at me.
Of course we will all lose our deposits. That’s going to happen folks. The FDIC does not have enough money to cover the deposits, if a WaMu collapses. They will turn to Congress and the Fed for credit, which will lead to inflation. But none of that will prevent a run on banks. Expect a freeze on deposit accounts shortly after a WaMu collapses.
I’m not being chicken little here, but too few people want to look at the cold hard facts. The FDIC is an insurance scheme that’s big flaw is a systemic financial panic. Everyone trying to claim money for withdrawal when only a fraction of it is in reserves to actually cover withdrawals.
Do you think the companies that insure against hurricanes could withstand a crisis where literally every holder of their policies was bringing a claim?
More people have to wake up and realize that there is something truly bizarre about “on demand” deposit accounts (i.e., accounts where you and I are supposed to be able to demand our money back at any point in time) and financial institutions using fractional reserve banking (i.e., only a small part of the on demand money is actually kept in the institution to pay for deposit demands). The reality is that this is a system that is only stable if people don’t demand their money in drastic numbers. It is entirely a banker’s fraud designed to give the banker cheap credit. The lie has just been repeated so much that we don’t bother to question it. There should be on demand accounts and interest bearing accounts. Accounts where we get the money back at any time and accounts where the money is locked up for a while but we get paid interest. Frankly we are de facto there on the interest rate perspective because banks pay nearly nothing on savings/checking/cd accounts. They just don’t bother to protect our assets.
So, by all means follow the FDIC limits. But don’t for a moment think that doing that guarantees you anything other than that if the FDIC is able to follow its policies, and chooses to do so, you will be protected. If this crisis gets too big, and they can’t or choose not to, out of luck
Good post and a very useful tool!
There’s also an “Is my bank FDIC insured” tool called Bank Find on their site.
Each of us could quickly think of several reasons why we don’t save more money. Excuses range from the routine (there’s nothing left at the end of the month?any extra money goes to pay off debt) to the philosophical (who knows what the future might bring?I can’t live my life worrying about finances).
These excuses ignore two simple facts: personal savings are important and saving money is doable! Even the most modest savings account comes in handy for unexpected expenses, like car repairs or medical emergencies. Long-term, savings and investments can help us with major expenses, like buying a new house; pay for our children’s education; cover living expenses if we lose our jobs; and, provide financial security when we retire.
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Tanyaa
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