Banks no safe havens for your money: DNA report
As the financial panic is money safe in banks 2008 deepens, with markets in free fall and the economy at risk, it's instructive to remember the failure of IndyMac bank last summer.
At first, nervous customers lined up congratulate, slot safe opinion withdraw their money, unaware that their savings were insured by the Federal Deposit Insurance Corp.
casino no download money online safe real panic subsided when the facts became known.
Here are the facts now.
The good news: The Finding money in has taken over 12 more banks since IndyMac's collapse without incident.
The bad news: Hundreds more banks are expected to fail before this financial crisis plays itself out.
YOUR BANKER Should I worry about the safety of my bank accounts?
In most instances, your money is insured by the FDIC, which is backed by the full faith and credit of the U.
This new, higher limit is effective through December 31, 2009.
Add up all the accounts in your name at a bank, including share safe box with deposit slot are, savings and money-market accounts as well as certificates of deposit.
My spouse and I have a joint checking account, and each of us is money safe in banks individual savings accounts at the same bank.
How much insurance does each of us have?
If you want to shelter more cash, you can open revocable-trust or payable-on-death POD accounts for your spouse, children, grandchildren, siblings or almost anyone you desire.
Or you can just move the excess cash to another bank.
My retirement-savings accounts are with my bank.
What is the maximum coverage for them?
Certain types of retirement accounts are covered by FDIC insurance, including IRAs, Roth IRAs, SEP IRAs and Keogh plans.
I bank at is money safe in banks credit union.
Is my money insured?
The National Credit Union Share Insurance Fund NCUSIFwhich was established by Congress and is backed by the U.
Are my credit-union retirement accounts insured?
Yes, the NCUSIF covers retirement accounts, is money safe in banks />I have source bank money-market account.
Are those funds insured?
Money that you keep in a money-market mutual fund may also be insured.
The Treasury recently announced a temporary program to guarantee both taxable and tax-free money-market mutual funds if the fund pays the necessary fee to participate.
This insurance program was created after the Prime Reserve Fund "broke the buck" and its share price dropped to 97 cents.
If the FDIC takes over my bank, as it recently did with IndyMac Bank, how long will it take for me to have access to my money?
IndyMac's depositors had continuous access to their funds through ATM and debit cards.
After federal regulators seized the bank on a Friday, some customers did not have online or phone access for a weekend, but everyone had full access to all their insured money by Monday morning.
If the FDIC takes over my bank, will I lose all my uninsured funds?
IndyMac account holders had access to 50% of their uninsured funds immediately.
When Mutual of Omaha Bank took over First National Bank of Nevada and First Heritage Bank of Newport Beach, Cal.
How can I check to see if all my money is insured?
Both the FDIC's Web site and the Link Credit Union Administration's site have a calculator is money safe in banks allows you to plug in all your accounts and the amounts deposited so you can find out whether any of your money is uninsured.
Go to and click on the Electronic Deposit Insurance Estimator EDIEor go to and use its Share Insurance Estimator Report.
YOUR BROKER What happens to is money safe in banks brokerage account if my firm goes bankrupt?
Brokerage firms must follow strict rules about segregating customers' investments from the firm's money, so your accounts should remain intact even if the brokerage goes under and another firm takes over its business.
For example, stocks, bonds and mutual funds are physically held by an independent depository, not the brokerage firm.
What if the firm misappropriated my assets?
You have another layer of protection in case the firm hasn't followed all of the rules: The Securities Investor Protection Corp.
If a money is safe firm fails, SIPC first tries to transfer the investors' securities to another firm.
If that doesn't work, it then attempts to rebuild the investors' portfolios, even buying new stocks or bonds to make up for any missing shares.
If the investments aren't available, SIPC will give you cash based on their value when the brokerage failed.
How much does SIPC cover?
If the customers' assets remain largely intact at the brokerage firm, then you can get back a lot more than that SIPC limit, which is a key difference between how SIPC protects brokerage customers and how the FDIC covers bank depositors.
In the 38-year history of SIPC, only 349 people have not received the full value of their accounts from their share of the firm's assets plus SIPC coverage -- and most of those instances occurred three decades ago or more.
If an investor's losses exceed SIPC's limits, the difference is usually covered by the broker's supplemental insurance -- often provided by Lloyd's of London or a new firm called Capco, the Customer Asset Protection Co.
Capco provides coverage above SIPC limits to 15 major brokerage firms, including Goldman Sachs, Morgan Stanley, Raymond James and Wachovia Securities.
Do I have access to my money after SIPC takes over?
That's the most common problem.
It tends to take from one week to two or three months to regain control of your account while SIPC sorts everything out.
It can take even longer if the brokerage firm kept shoddy records or was involved in fraud.
SIPC does not protect against market losses while your account is in limbo.
For more information about how SIPC works, and to make sure your brokerage firm is a member, go to the.
YOUR LENDER What if my mortgage lender or servicer goes belly up?
The problem is the lender's, not yours.
Continue paying your mortgage as before.
During the bankruptcy process, your lender will transfer your loan file to a new owner or servicer, and both parties will notify you by letter.
If you mistakenly send your payment to the old lender's address, you won't owe a late fee if you're within the federally mandated 60-day grace period after the transfer.
But what happens to my escrowed funds for taxes and insurance?
The money belongs to you, held in trust, so it won't become part of the lender's bankruptcy assets.
The new servicer will take over making tax and insurance payments from the account.
As a backstop, review your monthly mortgage statement and the escrow account analysis that you should receive from the new servicer within 45 days of the transfer.
If anything seems awry, call your lender or servicer, the property-tax office or your insurance company.
"Don't Believe Rumour, Bank Deposits Safe," Says PM On 'Bail-In' Worries
All money in the state-owned bank NS&I is fully backed by the Government, meaning money put in there is as near to 100% safe as you can get. Technically it doesn't have any more protection than any other institution, as ultimately the protection most banks have is that if they go bust, the Government will bail them out.
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