In order to protect financial institutions from experiencing a bank run during irregular financial stress, the Federal Deposit Insurance Corporation (FDIC) was created to protect deposit at financial institutions. By providing a guarantee, it is assumed that depositors would not flock to withdraw funds from a financial institution during periods of crisis. Thus, protecting the financial system during times of instability. One tool the FDIC provides is an insurance estimator. This tool can be helpful for depositors with multiple accounts to determine whether each account they own is protected or if the accounts are aggregated together to determine total protection.
See "FDIC's Electronic Deposit Insurance Estimator (EDIE)," fdic.gov.
h/t American Academy of Estate Planning Attorneys, Inc., www.aaepa.com.
Posted by Shahzeb Gaziani, Senior Associate Editor, Wealth Strategies Journal.
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