Quote:
Originally Posted by retiredguy123
FDIC insurance has never made sense to me. The limit is $250K per account, but you can set up about 4 or more different accounts with different names and account types and easily get millions in coverage. And if you want more coverage, you can just open accounts in different banks. Apparently, foreign banks can sell FDIC insured products if they do business in the U.S. Obviously, the Government doesn't care about protecting taxpayer money with reasonable insurance limits. Personally, I don't think FDIC insurance is very important as long as you spread your investments around and diversify.
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The $250,000. is somewhat of a pain but it spreads the risk if one bank fails. If everyone dumped all their money in the overly generous interest rates and low loan rates bank and it fails, the overt risk is obvious. As Wilson points out, the Fed can print money to cover FDIC. I’m old enough to remember the generation which lived through the Great Depression and saw some of the worthless stock certificates they were left holding. Their savings were decimated.