Question

9) You have $100,000 deposited in checking in the Loveland branch of Fifth-Third Bank. You also have $400,000 in another account (a savings account) opened at the Montgomery branch of Fifth-Third Bank.
Finally, you have $300,000 deposited in a CD with PNC bank. You have no other bank deposits. Assume these banks are not “Too Big to Fail.”

a) If none of the accounts listed above is a joint account, how much of your money is FDIC-insured?

b) If all of the accounts are held by both you, and the same joint owner (assume it is your mother) and your joint owner has no other money deposited in any FDIC bank, how much of this money is FDIC-insured?

(Bonus) If you have $750,000 deposited in a CD of a single bank, but the account is owned by three different people, how much of the $750,000 is government insured?

Answer 1

FDIC refers to Federal Deposit Insurance corporation which is an independent federal agency in US which insures the deposits in the event of bank failures.

The Limit for FDIC are as follows:

Single account - $ 250000 per owner per FDIC insured bank

Certain Retirement Account - $ 250000 per owner

Joint Owner without name beneficiaries - $ 250000 per co owner

a)		Fifth third bank (checking)			100000
		Fifth third bank (savings)			400000
		PNC Bank (CD)			$300,000
		Total			800000
		Amount Insured (250000*2)			500000
		Amount Uninsured			300000
b)		Fifth third bank (checking)			100000
		Fifth third bank (savings)			400000
		PNC Bank (CD)			$300,000
		Total			800000
		Amount Insured (250000*4)			1000000
					800000
c)		CD single Bank			$750,000
		Amount Insured(250000*3)			$750,000