Coronavirus Crisis: Are your finances protected?
Many Americans are concerned about securing their finances as the coronavirus ravages the U.S economy.
Financial services executive David Gibbons recommends keeping your hard-earned cash right where it is.
“I would recommend leaving it in the bank,” said Gibbons. “The FDIC will protect it.”
If you see an FDIC logo at your neighborhood bank, your money is protected by the Federal Deposit Insurance Corporation. Chairman Jelena McWilliams touts a perfect pay out record, since its inception in 1933.
“It is ok to feel anxiety about your money at this time,” said McWilliams. “But your bank deposits are safe because they are insured by the FDIC.”
So, what does that mean?
Checking accounts, savings accounts, and certificates of deposit are typically covered up to $250,000.
Certain retirement accounts, mutual funds, and annuities are not FDIC insured. Those investments could lose value if a bank goes under or if the market falls.
If you owe money, McWilliams says the FDIC is working with borrowers and their customers to restructure loans and extend credit.
“Our banks have strong capital and liquidity,” said McWilliams. “We will work with them as we weather this storm.”
While it’s best to take financial advice from an expert who knows your personal situation, Gibbons has a few tips to share.
“For folks that have money invested in equity markets, look selectively to dial back on that, or to redeploy it to some safer aspects of the market,” said Gibbons.
If you are not sure if your financial institution is FDIC protected, you can check on the FDIC website by searching for your bank under the ‘bank finder’ tab.
Credit unions are typically insured through the National Credit Union Insurance Fund. Banks also have the option to purchase excess insurance. Check with your financial institution for those details.