If savings account are only FDIC insured to $250K do you need to open another account?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:don't you use more than one bank OP? I use CapOne, Ally, and Vanguard. You can spread your money

This is pretty f**king stupid.

I guess if you have tens of millions, then keep $750k in cash earning nothing.

Maybe just have one account and then buy $500k of treasuries that will earn real interest.

Well some of us do have a lot more than $750K in cash and "tens of millions". Sure I could put it all in the market, but I have enough in the market to live the next 20+ years off of. And I have enough in cash/cash alternatives to live off of for 25+ years and never touch the principal. So yeah, I keep a portion in cash as I don't need the risk associated with the market.
And yes, my Financial advisor manages it so we have FDIC/NCUA protection.

Then you aren’t living the last Great Depression and opening up multiple bank accounts…if you are then you are a dumb f**k.

There is no market risk associated with treasuries if you hold to maturity and you can ladder them so some are maturing every year or every 6 months or every month if you want.

You do know it’s the same government backstopping treasuries as FDIC insurance, right?

I assume your financial advisor is doing what you request of him.

Mad poor man

What a stupid statement. I am UHNW and never have more than $100k just sitting in bank accounts.

There is literally no point. You can purchase treasury money market accounts that are fully backstopped and the same as cash.

Yet…somehow it’s rich people that open multiple bank accounts to store $250k each? You think Jeff Bezos has 1000 bank accounts to keep his cash on hand?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:don't you use more than one bank OP? I use CapOne, Ally, and Vanguard. You can spread your money

This is pretty f**king stupid.

I guess if you have tens of millions, then keep $750k in cash earning nothing.

Maybe just have one account and then buy $500k of treasuries that will earn real interest.

Well some of us do have a lot more than $750K in cash and "tens of millions". Sure I could put it all in the market, but I have enough in the market to live the next 20+ years off of. And I have enough in cash/cash alternatives to live off of for 25+ years and never touch the principal. So yeah, I keep a portion in cash as I don't need the risk associated with the market.
And yes, my Financial advisor manages it so we have FDIC/NCUA protection.

We use muni bonds, CD ladders, etc. It’s not just sitting in a bank.

And CD ladders have to be FDIC managed as well. We do a combination of whatever is best.

[Anonymous]

Anonymous wrote:Who keeps that much cash around? I don't see the rich doing it and the poor definitely shouldn't do it.

What are you supposed to do with it then?

[Anonymous]

Anonymous wrote:Since each account is only insured to $250K do you just keep opening new savings accounts?

Are you single? If so your options are limited and you might need to set up accounts at multiple banks. If you are married, you and your husband can each open individual accounts for $250 insurance, plus a joint account for a combined $500, so a million of FDIC insurance at your bank. There are other options, such as trusts can really increase FDIC insurance, with $250 per beneficiary. But as asked above, why keep that much cash on hand? Buy an index fund.

[Anonymous]

Anonymous wrote:Get a cash management account. The money gets swept to as many banks as necessary.

This is what I did at Fidelity

[Anonymous]

Anonymous wrote:

Anonymous wrote:Get a cash management account. The money gets swept to as many banks as necessary.

This is what I did at Fidelity

Do you track to make sure that your Fidelity account isn't putting your money into the same bank where you keep the bulk of your funds?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Who keeps that much cash around? I don't see the rich doing it and the poor definitely shouldn't do it.

What are you supposed to do with it then?

Apparently put it all in the market.

We put it in CDs/MM/Treasuries/Bonds/etc. Only a small percentage is in MM, but even the CDs need to be "managed across banks" to get the FDIC insurance.

Sure we could put 95% in stocks, but why? We have enough to not need to take that risk. So we manage the rest accordingly

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Who keeps that much cash around? I don't see the rich doing it and the poor definitely shouldn't do it.

What are you supposed to do with it then?

Apparently put it all in the market.

We put it in CDs/MM/Treasuries/Bonds/etc. Only a small percentage is in MM, but even the CDs need to be "managed across banks" to get the FDIC insurance.

Sure we could put 95% in stocks, but why? We have enough to not need to take that risk. So we manage the rest accordingly

Why buy CDs when you can just buy treasuries that pay more? I don’t understand at all why you would open all these CDs at different banks when you have a risk free asset that pays more, is 100% guaranteed and easy to manage.

There is no risk.

[Anonymous]

Anonymous wrote:If the account is joint, don’t you and spouse both have $250k protection? IDK, but have been meaning to look this up.

Yes joint accounts have $500k FDIC insurance.

[Anonymous]

Yes but there are different rules. Like
Me with DH as POD and then him with pod to me.

[Anonymous]

Anonymous wrote:Yes but there are different rules. Like
Me with DH as POD and then him with pod to me.

Are you mixing up joint accounts and trust accounts?

[Anonymous]

Too big to fail

[Anonymous]

Yes but at a different institution. It’s per account not per institution

[Anonymous]

Anonymous wrote:The rules are complicated. Opening two individually owned accounts at the same bank will not increase your coverage, but doing the same at two different FDIC insured banks will. That is assuming that the banks are really independent and not owned by the same parent.

Opening a individually owned account and a joint account will up your coverage. Opening another joint account with a different person will not up your coverage. Opening a trust account ups your coverage, but opening a second one does not. Going to a second bank, does.

If the banks they have separate charters then they have separate FDIC insurance, even if owned by the same parent. Also, savings and checking accounts are insured separately. But multiple accounts of the same type (checking, savings) are combined for deposit insurance purposes. Joint accounts are insured separately from individual accounts, but you can still only get up to an additional 250k through your joint accounts.

[Anonymous]

Anonymous wrote:

Anonymous wrote:The rules are complicated. Opening two individually owned accounts at the same bank will not increase your coverage, but doing the same at two different FDIC insured banks will. That is assuming that the banks are really independent and not owned by the same parent.

Opening a individually owned account and a joint account will up your coverage. Opening another joint account with a different person will not up your coverage. Opening a trust account ups your coverage, but opening a second one does not. Going to a second bank, does.

If the banks they have separate charters then they have separate FDIC insurance, even if owned by the same parent. Also, savings and checking accounts are insured separately. But multiple accounts of the same type (checking, savings) are combined for deposit insurance purposes. Joint accounts are insured separately from individual accounts, but you can still only get up to an additional 250k through your joint accounts.

Bunch of stuff wrong in there.