How The FDIC Protects Your Money

Peoples State Bank is a Member of the FDIC


Recent news of bank failures has included details that the impacted banks were taken over by the Federal Deposit Insurance Corporation (FDIC) to aid the bank’s customers in accessing their money. But what is the FDIC, and what does it mean that Peoples is a member of it?

The FDIC is the Federal Deposit Insurance Corporation. It’s an independent agency of the United States government that provides insurance for your deposits at financial institutions that are members. The insurance protects your deposit when an FDIC-insured bank or savings association fails.

But there are some rules regarding how much of your money and deposits are insured. Here’s what you need to know.

  • FDIC insurance covers all deposit accounts at insured banks and savings associations, including checking, NOW (Negotiable Order of Withdrawal) accounts, savings accounts, money market deposit accounts, and certificates of deposit (CDs) up to the insurance limit.
  • FDIC insurance does not cover the money you invest in stocks, bonds, mutual funds, life insurance policies, annuities, or municipal securities, even if you purchase these products from an FDIC-insured bank or savings association.
  • FDIC insurance covers your money up to $250,000 per depositor for each account ownership category at each insured bank or savings association.

So, what exactly does that last bullet point mean? The answer depends on whether you have accounts at a bank in your name only, or as a joint account with others, perhaps a spouse.

Let’s look at a single person who has several accounts at Peoples State Bank and try to explain a bit further. Betty Smith has a checking account and savings account at Peoples. Her checking has $4,500, while she has $100,000 in her savings account. She also has a CD worth $10,000. If she is the only owner of those three accounts and doesn’t have anyone listed as a beneficiary, those three deposit accounts are added together, giving her $114,500 in total deposits. Since she hasn’t hit the $250,000 insurance limit, all her deposits are covered fully. If her CD was worth $200,000, the total would put her above the $250,000 insurance limit, and she would be covered up to that level.

While this is relatively simple to follow, it does get more complicated when you add in joint ownership of accounts, beneficiaries, and other types of insured accounts. That’s why the FDIC has created a calculator to help you figure out your insured accounts. It’s called the Electronic Deposit Insurance Estimator (EDIE) and can be found here. On the site, you can find updated information related to rule changes the FDIC puts into place, a tutorial on EDIE, and answers to FAQs.

If you have deposit accounts at multiple banks or savings associations, you can create separate reports for each financial institution. Keep in mind that if you open an account at Peoples’ Stewart Avenue location, and later open an account at our Weston or Minocqua locations, those are not considered separate banks in this type of calculation. If you have deposit accounts at a credit union, they are not insured by the FDIC, but rather by the National Credit Union Administration (NCUA), which like the FDIC, is also an independent agency of the United States government.

If you have other questions about your accounts at Peoples State Bank, stop by one of our locations, call 888.929.9902, or email us at to get answers from a Peoples personal banker.