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Wednesday, March 22, 2006

FDIC DEPOSIT INSURANCE COVERAGES INCREASED

For the first time in 25 years, the FDIC (The Federal Deposit Insurance Corporation) has raised the maximum coverage amount on deposit insurance for bank and savings accounts. Generally, the first $100,000 in any bank or savings account is insured against loss if the institution holding the deposit fails. Depositors with more than $100,000 at any one institution are advised to consider spreading their deposits around multiple institutions to avoid the $100,000 limit.

Under new rules effective April 1, the maximum coverage is increased from $100,000 to $250,000, but only for certain retirement accounts. Covered accounts include traditional and Roth IRAs (Individual Retirement Accounts), self-directed Keogh accounts, “457 Plan” accounts for state government employees, and employer-sponsored self-directed defined contribution plan accounts—primarily 401(k) accounts.

A press release on the changes can be viewed here.
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