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I recently posted an article about how to find out if your bank is safe and also how to protect the money in your bank accounts. Here’s the article…
We were recently contact by a potential client who lost a great deal of his money when his bank was closed. This client was under the wrong impression that as long as he kept all of his money in the bank, it was protected. Nothing could be further from the truth!
Step No. 1...
Here are several good tools and tips to help keep you money safe and sound… Step No. 1- Find out how safe your bank really is. Go to the BankRate web site and review the safe and sound ratings of your bank. Go to http://www.bankrate.com/brm/safesound/ss_home.asp
Step No. 2...
Use the interactive worksheets which will tell you if your deposits are insured. Go to fdic.gov and visit the FDIC's Electronic Deposit Insurance Estimator. Generally if you have up to $100,000 in any one bank or up to $200,000 for joint accounts, the money is safe. Also, some retirement accounts are insured up to $250,000. Other investment firms like Charles Schwab may offer additional protection.
Step No. 3...
If you need more protection, you can change ownership status on the account so that you and your spouse can have individual $100,000 accounts plus a joint account that holds $200,000. All will be insured. (Note- this may not be the smartest way to spread your money around because in most cases, a judgment creditor will be able to attach these funds to collect a judgment. The use of certain specific trust may be a better alternative).
Step No. 4...
You can set up a "home bank" and stay fully insured. Here's how this works. The certificate of Deposit Account Registry Service (CDARS) lets you keep up to $50 million in CDs with one "home bank" and stay fully insured. What happens is that participating banks parcel out your holdings among other participating banks. Normally you get a single consolidated statement for all accounts. This is a good way to easily protect your money while in between investments.
The above information is provided for discussion purposes only. Jackson & Wilson, Inc. and its attorneys believe in helping people and answering their questions and providing information and solutions. To encourage and facilitate this practice, it is understood and agreed by the recipient that by opening, reading and viewing this information, no attorney-client relationship has been discussed, agreed to or otherwise established. In legal matters, time is of the essence. As such, you should contact an experienced lawyer right away to protect your legal rights!
Jon Mitchell "Mitch" Jackson
Jackson & Wilson, Inc.
An "AV" rated firm listed in Martindale-Hubbell's Bar Register of Preeminent Lawyers www.JacksonWilson.com