Keeping Your Money Safe

With everything in the financial world lately - the Treasury takes over Fannie Mae and Freddie Mac, the collapse of Lehman Brothers and IndyMac Bank, and the government rescue of AIG - it's no surprise that investors should ask themselves whether their money is secure.

Fortunately, there are security measures exist for different types of bank accounts and investments. Here is an overview of the various safetynet in place for each type of account or investment is tohave:

Banks: Bank deposits are guaranteed by the Federal Deposit Insurance Corporation (FDIC). Basically, the FDIC insured deposits up to $ 100,000 per owner, per bank. If you have $ 100,000 or less in your name at any FDIC-insured bank or savings association, you have nothing to fear. Since the limit per owner, which means you could (and even more media attention than you think, for example, if you and your spouse have a joint account with U.S. $ 300,000 in a bank, 200,000 is insured U.S. Dollar - $ 100,000for each "owner").

In addition, if you have certain retirement accounts, such as an individual retirement account, you are eligible for even more coverage - up to 250,000 dollars per owner, per bank. However, the FDIC does not insure money invested in stocks, bonds, mutual funds, life insurance, annuities and municipal securities, even if you've purchased these investments at a FDIC insured bank.

Credit unions have similar coverage through the National Credit UnionAdministration (NCUA).

Mutual funds and brokerage: Some investors are wondering what would happen in the event that the fund or brokerage firm, they would fail to keep their investments. The means that you have when a fund company or brokerage account are from the assets of the company separated. Thus, in the case of a company would fail, your assets are not liquidated to pay the debts of the company. If the fund or brokerage companies do not, would your assets meetBrokerage firms are transferred to another.

However, if one of your assets are missing, whether due to business failure, fraud or bad accounting, you are protected. The Securities Investor Protection Corporation (SIPC) is a non-profit company that protects investors if a broker / dealer defaults. Investors are protected up to $ 500,000 per account, per brokerage firm.

Note that the SIPC is not all investments. Some who are not covered include annuities,Commodity futures, foreign currencies, limited partnerships and precious metals. The SIPC does not protect against market losses or bad investments. The purpose of the SIPC is to replace securities that are missing customer accounts, up to the limits of their range.

Now that you protect yourself is aware of the limits, both for banks and brokers or fund companies, the best way to ensure that you are not above the insured limit on eachthe financial institutions you do business with. If you can, you have different ownership forms to open accounts or open new accounts at different institutions to ensure that your money is safe. Moreover, not all CDs and savings accounts FDIC insured. Before you buy an investment, be sure to drop by the appropriate agency, and do your research to determine whether you are investing with a reputable company.