4 ms·
I completely disagree, only the first $250k is insured. I would never store $16M cash in a bank. You aren't protected against the bank becoming insolvent.
by thebean11 6y ago
I completely disagree, only the first $250k is insured. I would never store $16M cash in a bank. You aren't protected against the bank becoming insolvent.
- google234123 6y agoIsn't it 250k per account?
- tialaramex 6y agoNo. FDIC is per depositor, per bank, per ownership category. So if you have $300k in Bank A, and $180k in Bank B, and then suddenly both Bank A and Bank B fail, the US Federal Government promises you'll get $250k from Bank A and $180k from Bank B, and pretty quickly - but the remaining $50k from Bank A depends on what happens when they try to wind up Bank A, if it's a complete wreck you may see nothing or almost nothing back or it may take years to get 10¢ on the dollar for the remaining amount. In some cases you may be able to create multiple ownership categories that help you, and I guess if you really had $16M you might do stuff like set up a multi-beneficiary trust fund that can have $1M in it with four beneficiaries for an additional $250k per person FDIC insured.
- sidewndr46 6y agoFDIC is presently $250,000 lifetime limit.
- smabie 6y agoOkay... where would you store 16m?
- majkinetor 6y agoWhats wrong with random hole on random private place you own ?
- ericd 6y agoProbably in US Treasury Bills?
- tootie 6y agoIn an investment account with a reputable brokerage.
- herpderperator 6y agoWhat's the difference between that and a bank?
- tialaramex 6y agoWell the fun part is that the way it's different is that there would be a bank account with your money in it, that the brokerage isn't allowed to touch. So, you're protected from the brokerage going bankrupt - your money is still yours if that happens. But it's still in a bank account, so if the bank goes under you're screwed. See my other comment in this thread though...
- herpderperator 6y agoSIPC isn't unlimited, though: The Securities Investor Protection Corporation (SIPC) was created to protect against the loss of customer assets at brokerage firms. SIPC offers protection of up to $500,000, including a $250,000 limit for cash, if a brokerage firm fails, and covers most types of securities, such as stocks, bonds, and mutual funds. [0] [0] https://www.schwab.com/public/file/P-3042070/Asset_Protection_Brochure_MKT45080-09.pdf https://www.schwab.com/public/file/P-3042070/Asset_Protectio...
- tootie 6y agoMy holdings accumulate capital gains and are insured by market forces rather than the FDIC. I can put them in volatile holdings like stocks, or fixed income or even just money markets. That's pretty much what banks are doing and just keeping a bigger percentage of the returns for themselves.
- zajio1am 6y agoAFAIK, the underlying assets in investment accouns are owned by their account holders, the broker just manages them. If the broker becames insolvent, these assets are not part of insolvency proceeding. For regular bank account, there are no other underlying assets, it is just the sum bank owes to the account holder. If the bank becames insolvent, outside of insurance limits, these are just claims against the bank.
- dumbfounder 6y agoMore than one place.
- Scoundreller 6y agoNot all in the same wallet/bank/stock/currency/... That way if something goes awry, I still have the rest.
- cma 6y ago64 banks, or treasuries
- throwaway43234 6y agoSome in stocks, some in banks, some in bonds, some in real estate, some in precious metals, etc.
- tialaramex 6y agoI would use the bank owned by my government, the National Savings and Investment bank. And I do. The reason is that since the government owns this bank, and the government issues the money, if the bank fails the government fails too and the money is now worthless anyway.
- fluffything 6y agoMSCI ACWI IMI, FTSE ALL-WORLD, etc. For that to fail, the whole world economy would need to fail as well, and at that point, no money on any currency is worth anything.