People are trying to withdraw their money in Silicon Valley banks after the California Department of Financial Protection and Innovation. FDIC closed on March 10.
When the Federal Reserve hiked interest rates to combat inflation, the market value of Silicon Valley bank assets, including securities, fell, bankrupt the bankBank depositors rushed to withdraw all their funds and ended up selling many securities and bonds to satisfy those withdrawals.
of The collapse of Silicon Valley Bank Even those who don’t use the Silicon Valley branch ask questions like, “Is my money safe in the bank?” And “Should I withdraw money from the bank?”
Here’s what you should know:
Is my money safe with a local bank?
Banking regulations have changed over the years to protect consumers, so most people don’t have to worry about losing money in the bank, even during an economic downturn.
As long as the bank is federally insured through FDIC insurance, Your money is protected up to $250,000 in individual accounts and $500,000 in joint accounts.
Most financial institutions have federal insurance through either the FDIC or the National Credit Union Administration (NCUA). They provide insurance for money deposited in banks.
So even if the financial institution collapses Your money will probably be transferred to another FDIC insurance bank or you will receive a check with the amount from your account.
Account types covered by this protection include savings accounts, money market accounts, checking accounts and CDs. Brokerage firms and investment accounts are generally not protected by these entities.
Need to withdraw money from the bank?
If you’re worried about leaving money in your bank account if the economy takes a turn for the worse, there’s no rush to withdraw because your money is federally protected.
In other words, Your money is probably safe at your financial institution If your account balance is less than $250,000.
Maggie Gomez, CFP expert and owner of Money with Maggie, told an insider If you’re worried about keeping all your money in one place, consider keeping it in two different banks.
Jay Hatfield, CEO of Infrastructure Capital Advisors and portfolio manager of the InfraCap Equity Income ETF, told CNN. no point in withdrawing money As long as the bank has FDIC insurance.
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