MORE FDIC SMOKE AND MIRRORS – ANN BARNHARDT
I do not usually add any information to Ann Barnhardt’s posts but this is important and should not be overlooked. In the past, banks segregated family assets into multiple accounts to take advantage of the FDIC limitation. If you have two accounts now each totally $200,000.00, this change at the end of last year now puts $150,000.00 at risk.
I know this may not impact the majority of people but as we have seen in the past, this government always has more steps in their plans. Combining retirement plans into this amount or reducing the amount back to $200,000 or the original $100,000 would have an impact. With the massive exposure banks have in credit derivatives
, the FDIC will not cover a fraction of the bank accounts.
A reader sent this in. Effective December 31, 2012, FDIC insurance became AGGREGATED with a maximum PER OWNER cap of $250,000.Many of you are under the impression that FDIC protection is per account, and thus if you just keep your money spread around and never keep more that a quarter-mil in cash in any one bank that you are “safe”.Nope. It is tied to your Social Security number / Tax ID number now.
And remember, total bank deposits in the U.S. are somewhere around TEN TRILLION DOLLARS and the FDIC deposit insurance fund as of March 31, 2012 had a whopping $15 BILLION.
Bottom line: if you think your bank deposits are “insured” or “safe” because of FDIC protection, you’re totally irrational.
December 31, 2012As scheduled, the unlimited insurance coverage for noninterest-bearing transaction accounts provided under the Dodd-Frank Wall Street Reform and Consumer Protection Act expired on December 31, 2012. Deposits held in noninterest-bearing transaction account are now aggregated with any interest-bearing deposits the owner may hold in the same ownership category, and the combined total insured up to at least $250,000.