FDIC Insurance

20230702_rev01 · COMPARED WITH 20230402_rev01 · ARCHIVE SNAPSHOT, DATE APPROXIMATE

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1The FDIC-or Federal Deposit Insurance Corporation-is a U.S. federal agency that protects you up to certain limits against the loss of your deposit accounts (such as checking and savings) if your FDIC-Insured bank fails.
1Here are answers to the most common questions about what FDIC insurance is and how it works to keep your money safe.
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3The basic FDIC insurance amount for deposit accounts is up to $250,000 per depositor, per insured bank, based on ownership type and $250,000 per owner per insured bank for self-directed retirement accounts deposited at an insured bank. These insurance limits include principal and accrued interest.
3## What is the Federal Deposit Insurance Corporation?
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5The FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities, municipal securities, and money market funds, even if these investments were bought from an insured bank.
5The Federal Deposit Insurance Corporation (FDIC) is an independent agency of the U.S. government that protects bank depositors against the loss of their insured deposits if an FDIC-insured bank or savings association located in the United States fails. Any person or entity can have FDIC insurance coverage on their deposits in an insured bank. A person does not have to be a U.S. citizen or resident to have his or her deposits insured by the FDIC. FDIC insurance is backed by the full faith and credit of the United States government.
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7## FAQs
7## What is covered by FDIC deposit insurance?
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9The FDIC insurance limit applies to each account holder at each bank. Here is how the FDIC defines coverage for different account holders by some common "ownership" types:
9FDIC insurance covers depositors' accounts at each insured bank, dollar-for-dollar, including principal and any accrued interest through the date of the insured bank's closing, up to the insurance limit.
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11- **Single accounts**. Deposit accounts (e.g., checking, savings) owned by one person. FDIC insurance covers up to $250,000 per owner for all single accounts at each bank.
12- **Joint accounts**. Deposit accounts owned by two or more people. FDIC insurance covers up to $250,000 per owner for all joint accounts at each bank.
13- **Certain retirement accounts**. Accounts such as IRAs and self-directed defined contribution plans1. All such accounts owned by the same person at the same bank are aggregated towards the $250,000 FDIC coverage limit for these types of accounts.
11FDIC insurance covers all types of deposits received at an insured bank, such as:
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15Here is a [full list of FDIC Ownership categories](https://www.fdic.gov/resources/deposit-insurance/financial-products-insured/).
13- Checking accounts (such as [Schwab Bank Investor Checking™ accounts](https://www.schwab.com/checking))
14- Savings accounts (such as [Schwab Bank Investor Savings™ accounts](https://www.schwab.com/savings))
15- Negotiable Order of Withdrawal (NOW) accounts
16- Money market deposit accounts (MMDA)
17- Time deposits such as Certificates of deposit (CDs) (such as those available through Schwab's [CD OneSource® marketplace](https://www.schwab.com/certificates-of-deposit))
18- Bank Sweep Feature-If the cash feature in effect for your Schwab brokerage account is the [Bank Sweep Feature](https://client.schwab.com/secured/cash-investments/sweep-and-interest-services), your uninvested cash balances are automatically swept to one or more Program Banks where it is eligible for FDIC insurance
19- Cashier's checks, money orders, and other official items issued by a bank
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17Use the FDIC's [Electronic Deposit Insurance Estimator (EDIE)](http://www.fdic.gov/edie) to calculate your FDIC coverage for FDIC-insured banks where you have deposit accounts.
21## What financial products are not insured by the FDIC?
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19You can also use the FDIC's estimator for hypothetical situations. For instance, if you would like to see how much of some assets would be covered by FDIC insurance, you can enter bank and account information and get an estimate on how much would be insured.
23FDIC insurance does not cover non-deposit investments or investment products, even if they were purchased at an insured bank. These include:
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21The following products are eligible for FDIC coverage at Schwab's Affiliated Banks:
25- Stock investments
26- Bond investments
27- Municipal securities
28- Mutual funds (including money market funds)
29- Life insurance policies
30- Safe deposit boxes or their contents
31- U.S. Treasury bills, bonds or notes
32- Exchange traded funds
33- Annuities
34- Cash held in Schwab One® Interest Feature
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23- [Schwab Bank Investor Checking™ accounts](https://www.schwab.com/public/schwab/banking_lending/checking_account)
24- [Schwab Bank Investor Savings™ accounts](https://www.schwab.com/public/schwab/banking_lending/savings_account)
25- [Bank Sweep Feature](https://www.schwab.com/sweep)-Your Schwab brokerage account includes a feature that pays interest on idle cash. If your account uses the Bank Sweep Feature, your cash balances are automatically swept to one or more Program Banks where it is eligible for FDIC insurance. To see which cash feature you have, [log in](https://client.schwab.com/trading/start) and go to your Brokerage Account Balances page.
36## How is FDIC insurance coverage determined?
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27All deposits held at the same FDIC-insured bank in the same ownership capacity (as described in the previous section) are added together to determine your total amount of FDIC insurance coverage at that bank. This rule applies whether you open an account directly at the bank or Schwab brokerage holds the accounts on your behalf. (See Example 2 below.)
38The standard deposit insurance amount is $250,000 per depositor, per insured bank, for each account ownership category at a bank. All deposits a depositor has in the same ownership category at each insured bank are added together and insured up to $250,000. Funds deposited in separate branches of the same insured bank are not separately insured.
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29Charles Schwab & Co., acting as a deposit broker, can place deposits at FDIC-insured banks on your behalf. In this case, the FDIC insurance available from the bank "passes through" to you. FDIC-insured deposits are available through your Schwab brokerage account for:
40The FDIC provides separate insurance coverage for deposits held in different categories of legal ownership. The FDIC refers to these different categories as "ownership categories." This means that depositors may qualify for more than $250,000 in insurance coverage if they have funds deposited in different ownership categories and all FDIC requirements for each ownership category are met. The different ownership categories include:
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31- Certificated of Deposit-Through Schwab CD OneSource®, you can buy and track CDs from multiple banks in your Schwab brokerage or retirement accounts. Your deposits at each insured bank are insured separately, whether you open the accounts directly from the bank or the deposits are placed for you through a broker. (See Example 1 below.)
32- Bank Sweep Feature- If the cash feature in effect for your Schwab brokerage account is the Bank Sweep Feature, your cash balances are automatically swept to deposit accounts at Program Banks where they are eligible for FDIC insurance. Keep in mind that deposits you hold at a single Program Bank-whether you open an account directly at the bank or Schwab brokerage holds the accounts on your behalf-are added together with other deposits you hold at that same bank in the same ownership capacity in order to determine the total amount of FDIC insurance coverage for your deposits.
42- **Single accounts owned by one person**
43- **Joint accounts owned by two or more people**
44- **Certain retirement accounts such as IRAs and self-directed contribution plans**
45- **Revocable trust accounts**
46- **Irrevocable trust accounts** _(this category will be combined with revocable trust accounts in April 2024)_
47- **Employee benefit plan accounts**
48- **Corporation/partnership/unincorporated association accounts**
49- **Government accounts**
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34The following investments do not receive FDIC coverage through your Schwab brokerage account:
51So, for example, a single depositor can be eligible for $250,000 of coverage for funds held at a specific FDIC-insured bank in a single account, plus $250,000 held at that same bank in a joint account, plus $250,000 held at that same bank in a retirement account such as an IRA, for a total of $750,000 of coverage.
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36- Stocks
37- Bonds
38- Mutual funds
39- Life insurance policies
40- Annuities
41- Municipal securities
42- Money market funds
43- Cash held in Schwab One® Interest Feature
53Here is a full list of [FDIC ownership categories](https://www.fdic.gov/resources/deposit-insurance/financial-products-insured/) and [deposit insurance videos](https://www.fdic.gov/deposit/deposits/video.html) from the FDIC.
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45Example 1: If you have a Schwab brokerage account, in just your name, with two $250,000 CDs from two different banks, and you have no other deposits at those banks, your CDs would be covered for a total of $500,000 ($250,000 at each bank). However, if those two CDs are from the same bank, then FDIC insurance would cover a total of only $250,000 (leaving $250,000 of these CDs uninsured by the FDIC).
55## How can I calculate my FDIC insurance coverage?
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47Example 2: If you have a Schwab Bank Investor Checking account, in just your name, with $200,000 and a Schwab brokerage (non-retirement) account with Bank Sweep Feature, in just your name, that has swept cash balances of $75,000 into deposits at Schwab Bank, then FDIC insurance would cover a total of $250,000 (leaving $25,000 of these deposits uninsured by the FDIC).
57Because the deposit insurance rules are complex, you may want to use the [FDIC's Electronic Deposit Insurance Estimator (EDIE)](http://www.fdic.gov/edie) to calculate your FDIC coverage for FDIC-insured banks where you have deposit accounts.
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49Calculating deposit insurance can be complex, especially if you have multiple accounts registered in the same ownership capacity.
59You can also use the FDIC's estimator for hypothetical situations. For instance, if you would like to see how much of some assets would be covered by FDIC insurance, you can enter bank and account information and get an estimate on how much would be insured.
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51For more information, use the [FDIC's Electronic Deposit Insurance Estimator (EDIE)](http://www.fdic.gov/edie) to estimate your total coverage at a particular bank.
61## Examples of FDIC insurance coverage:
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53For more information about FDIC-insured products available through Schwab's Affiliated Banks or your Schwab brokerage account, [contact us](https://www.schwab.com/contact-us).
63**Example 1**: If you have a Schwab brokerage account, in just your name, with two $250,000 CDs from two different banks, and you have no other deposits at those banks, your CDs would be covered for a total of $500,000 ($250,000 at each bank). However, if those two CDs are from the same bank, then FDIC insurance would cover a total of only $250,000 (leaving $250,000 of these CDs uninsured by the FDIC).
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55## Asset protection
65**Example 2**: If you have a Schwab Bank Investor Checking account, in just your name, with $200,000 and a Schwab brokerage (non-retirement) account with Bank Sweep feature, in just your name, that has swept cash balances of $75,000 into deposits at Schwab Bank, then FDIC insurance would cover a total of $250,000 (leaving $25,000 of these deposits uninsured by the FDIC).
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57Read our [SIPC information](https://www.schwab.com/legal/sipc-account-protection) to see how we protect your Schwab brokerage account.
67**Example 3**: If you have $250,000 in a Schwab Bank Investor Checking account held in just your name, plus $500,000 in a joint Schwab Bank Investor Checking account owned by you and one other person (meaning your ownership of that $500,000 is $250,000), plus a retirement account such as an IRA which has a swept cash balance of $250,000 at Schwab Bank, then FDIC insurance would cover a total of $750,000 for you, plus the $250,000 owned by the other owner of your joint account.