The Savings Game

$250,000 FDIC guarantee will protect your account through 2013, not just 2009

By Humberto Cruz
June 30, 2009
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I walked into the bank to deposit a check and saw a big sign meant to reassure customers about Federal Deposit Insurance Corp. protection. Unfortunately, the sign was misleading.

“Deposits guaranteed by FDIC up to $250,000,’’ it said. Then, in smaller type: “Through Dec. 31, 2009.’’

If banks are giving out wrong information, no wonder so many people don’t know about the new law. I am talking a law Congress approved May 19 extending the $250,000 FDIC insurance limit through Dec. 31, 2013. At the height of the economic crisis last October, lawmakers had temporarily increased the basic limit on FDIC coverage to $250,000 from $100,000 per depositor per insured bank through Dec. 31, 2009.

I have seen at least a dozen news articles - not to mention three bank newspaper ads and now the sign at my bank - still giving the old and now erroneous expiration date.

“Consumers who like the safety and security of federally insured certificates of deposit will be interested in the new law,’’ said Jay Rosenstein, an FDIC spokesman who contacted me about publicizing the extended deadline.

I’m happy to do so because, overshadowed by almost around-the-clock news about the ailing auto industry, the extended FDIC protection received relatively scant media attention at the time. I’ve also gotten several e-mails and letters from readers with more than $100,000 in bank CDs who thought they would lose FDIC coverage after Dec. 31.

But with the extended deadline, “if you (or your family) have $250,000 or less in all of your deposit accounts at the same insured bank, you don’t need to worry about your insurance coverage - your deposits are fully insured through at least 2013,’’ says the spring 2009 issue of FDIC Consumer News, the agency’s quarterly newsletter.

As it points out, you may actually qualify for more than the basic insurance coverage at one insured bank, because the FDIC provides separate insurance coverage for deposits held in different “ownership categories,’’ such as single accounts and joint accounts (and custodial accounts). For detailed information, go to or call the FDIC toll-free at 877-275-3342.

Certain retirement accounts, including bank IRA deposits, will continue to be protected separately up to $250,000 even after 2013 because that is the permanent coverage limit previously set by Congress.

You can read the free and informative FDIC newsletters online by doing a search for FDIC Consumer News at the website.

As to FDIC coverage after 2013, while I’m not in the prediction business I expect there will be intense consumer pressure to make the higher limits permanent, or at least give depositors plenty of warning if the limit is to revert to $100,000.

Humberto Cruz can be reached at