Top 10 misconceptions about deposit insurance

by Center for Personal Finance editors

WASHINGTON (5/23/06)--You know your savings are insured, but did you know that the No. 1 misconception about deposit insurance is that the most you can have insured is $100,000? (FDIC Consumer News Spring 2006).

Fact: Depending on the type and ownership of accounts--such as single ownership, joint ownership, revocable trust, and self-directed retirement accounts--you could have more than $1 million in share insurance coverage.

The Federal Deposit Insurance Corporation (FDIC) issues a quarterly newsletter, and the spring edition highlights the top 10 misconceptions that some people have about FDIC insurance. Kathy Thompson, the Credit Union National Association's associate general counsel for regulatory compliance, recommends the article.

"Federal share insurance, which protects credit union accounts, is just like FDIC insurance, which covers bank accounts, so credit union members might find it interesting to read the FDIC's article about the top 10 misconceptions about deposit insurance," Thompson said.

According to the FDIC, another commonly held misconception is that changing the order of names or Social Security numbers, or substituting "and" for "or" in account titles, can increase the coverage for joint accounts. Not true.

You can find the article--listing all 10 misconceptions and the facts associated with them--at fdic.gov/consumers/consumer/news/cnspr06/leadstory.html

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