*First National Community Bank’s blog does not constitute legal, tax, accounting, investment or other professional advice. Recipients should consult their professional advisors for advice.

FDIC stands for Federal Deposit Insurance Corporation. The FDIC is an independent agency of the U.S. government that insures deposit accounts in U.S. banks and thrifts. The FDIC's purpose is to protect consumers' deposits in member financial institutions so if a member bank fails, you can get your money back up to an eligible amount. First National Community Bank has outlined what FDIC insurance is, how it works and how to maximize it.

  1. How Does FDIC Insurance Work?

FDIC insurance covers up to $250,000 per depositor, per insured bank, for each account ownership category. FDIC coverage starts automatically as soon as you open your account and protects deposits on your behalf.

FDIC insurance covers many types of deposit accounts, including checking, savings, money market, and certificate of deposit (CD) accounts. As noted above, the current standard insurance amount is $250,000. First National Community Bank participates in the FDIC insurance coverage program on all of our deposit products.

It is important to note that not all financial institutions are FDIC-insured. Banks and savings associations that are insured by the FDIC will display the FDIC logo on their premises and websites. You can also visit the FDIC website to check to see if your bank is insured: https://www.fdic.gov/

  1. How Can FDIC Insurance Coverage Be Maximized On Consumer Accounts?

As a consumer, there’s a strategy to maximize your FDIC insurance coverage by opening accounts in different ownership categories, such as:

Single Account: When you open an account by yourself it is considered a single account and the coverage limit is $250,000 per owner. Married couples can each open a single account and have full coverage on both accounts, up to $250,000 per account. In this way, a couple could have $500,000 protected by the FDIC with two single accounts.

Joint Account: If you open a joint account with two owners (i.e. you and your spouse), you will each be covered up to $250,000, which doubles your FDIC coverage. .

Revokable Trust Account: You can increase your FDIC insurance coverage by creating a payable-on-death account. This is also known as an ‘informal trust’ or ‘in-trust-for’ account in the name of a formal revokable trust. For these types of accounts, each unique beneficiary adds $250,000 of coverage up to FDIC limits.

  1. How Can FDIC Insurance Coverage Be Maximized On Business Accounts?

Insured Cash Sweep (ICS):  For businesses, a smart, secure and convenient option to protect your assets is an Insured Cash Sweep. Insured Cash Sweep allows you to access FDIC insurance above $250,000 through a single bank relationship. Bank customers can access multi-million-dollar FDIC protection on large deposits, earn a return, and enjoy flexibility. ICS deposits are sent to other FDIC Insured ICS Network banks. Learn more about ICS by visiting the ICS page on our website:  www.fncbank.com/ICS

Understanding how FDIC insurance works and how to maximize it is an important part of your financial strategy. As your locally owned community bank of choice, the success of your financial future is top of mind. We offer Personal Checking Accounts, Money Market, Personal Savings Accounts, CDs, IRAs, Business Loans, Treasury Management Services, Mortgages, Personal Loans of all shapes and sizes and much more! To learn more about First National Community Bank’s financial solutions, contact us here.

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