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Old 09-16-08, 09:36 AM   #1
mustang1
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suppose you have a some money in a bank...

and the bank tanks (declare bankruptcy, declare close of business due to current economic conditions, whatever), do you lose all your money?

Is it safer to just take the money out? Where to put it?
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Old 09-16-08, 09:38 AM   #2
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That is why you should only go to a bank that is FDIC insured. If you get close the insured limit, go to another bank and open another account.
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Old 09-16-08, 09:38 AM   #3
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Depositors in banks are insured by the FDIC up to $100K. If you have more than that you lose. Long term we all lose when a bank flops and the FDIC pays off, because they are using our tax money.

This is in the USofA, not sure of other countries laws.
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Old 09-16-08, 10:51 AM   #4
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If you belong to a credit union, you should get the same coverage from NCUA - up to $100,000.

Last edited by cyberlegend1994; 09-16-08 at 10:54 AM.
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Old 09-16-08, 11:02 AM   #5
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which bank flopped recently to spark this question?
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Old 09-16-08, 11:41 AM   #6
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It depends on the details. Most (but not all) accounts are insured up to $100,000 by a federal agency. In the past, even larger accounts have been paid off, but that might not be the case now. In a total disaster, you might not get even the whole $100,000...if too many banks are failing and the agency runs out of money, and Congress doesn't bail them out. But that's highly unlikely.

I've been through a bank failure and barely knew it. The bank was absorbed by another bank, and the insuring agency didn't get involved, at least not directly. There was a new name and address on mail from my bank, but I kept doing business at the same building even though it acquired a new sign, and I even kept using the same checks for quite a while.
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Old 09-16-08, 01:39 PM   #7
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and the bank tanks (declare bankruptcy, declare close of business due to current economic conditions, whatever), do you lose all your money?

Is it safer to just take the money out? Where to put it?
If said bank is NOT FDIC insured, then yes, you lose your money. Put it in a FDIC-insured bank, or you'd better find a nice safe to hold all of your cash (which isn't the best idea either).
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Old 09-16-08, 01:46 PM   #8
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Put everything in gold bullion and diamonds.
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Old 09-16-08, 01:57 PM   #9
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You know that might not be such a bad idea...if I had a few hundred to burn!
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Old 09-16-08, 02:08 PM   #10
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Put everything in gold bullion and diamonds.
Diamonds are worth next to nothing.

As everyone else has said, if the bank is FDIC insured you're fine. I can't really see a reason why someone would have 100k in an account.
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Old 09-16-08, 02:10 PM   #11
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You can have more than 100k in the bank. As long as the account is vested properly you should be fine. I work at a bank, Indymac Bank actually, and have dealt w/ the FDIC extensively.
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Old 09-16-08, 03:22 PM   #12
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You can have more than 100k in the bank. As long as the account is vested properly you should be fine. I work at a bank, Indymac Bank actually, and have dealt w/ the FDIC extensively.
What do you mean by vested properly?
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Old 09-16-08, 03:35 PM   #13
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What do you mean by vested properly?
Meaning, the names on the account.

Say Bob and Frank have an account.

Bob-single owner, insured 100k
Frank-single owner, insured 100k

Now, if Bob and Frank decided to add beneficiaries then that will increase their FDIC insurance. Now, if Bob added his wife and two kids to the account as beneficiaries, that will increase the insurance to 300k.
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Old 09-16-08, 03:35 PM   #14
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Okay, so what happens when the FDIC doesn't have enough money to cover the losses? SIPC is already going to explode from their paltry 1.5B in available assets to cover losses...

FDIC is doing a little better with 2.2 Billion. But, this is still NOTHING compared to what we could see as more banks start to fail.
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Old 09-16-08, 03:46 PM   #15
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If you belong to a credit union, you should get the same coverage from NCUA - up to $100,000.
I use to work for NCUA years back and it was always a much robust insurance fund than the FDIC. I rather have all my money in credit unions that are federally insured through NCUA
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Old 09-16-08, 03:55 PM   #16
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Okay, so what happens when the FDIC doesn't have enough money to cover the losses? SIPC is already going to explode from their paltry 1.5B in available assets to cover losses...

FDIC is doing a little better with 2.2 Billion. But, this is still NOTHING compared to what we could see as more banks start to fail.
They always have access to Treasure funds. It is not an ideal solution, but a solution nonetheless.

EDIT: I meant treasury funds. Not Treasure funds. lmao

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Old 09-16-08, 04:33 PM   #17
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and the bank tanks (declare bankruptcy, declare close of business due to current economic conditions, whatever), do you lose all your money?

Is it safer to just take the money out? Where to put it?
In what country is the bank located?
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