Читать книгу Investing All-in-One For Dummies - Eric Tyson - Страница 108

What makes keeping your money in a U.S. bank unique is the Federal Deposit Insurance Corporation (FDIC) insurance that protects bank deposits. If your bank fails (and as history shows, some banks do fail), and if your bank participates in the FDIC system, your bank account is insured by the U.S. government up to $250,000. The stamp of FDIC backing and insurance is soothing to some folks who worry about all the risks and dangers in the investment world.

While the FDIC insurance is worth something, banks have to pay for this protection. That cost is effectively passed along to you in the form of lower interest rates on your deposits.

Just because the federal government stands behind the banking FDIC system doesn’t mean your money is 100 percent safe in the event of a bank failure. Although you’re insured for $250,000 in a bank, if the bank fails, you may wait quite a while to get your money back — and you may get less interest than you thought you would. Banks fail and will likely continue to do so. During the 1980s and early 1990s, and again in the late 2000s, hundreds of insured banks and savings and loans failed. (Between the early 1990s and mid-2000s — a relatively strong economic period — only a handful of banks failed annually.)

Any investment that involves lending your money to someone else or to some organization, including putting your money in a bank or buying a Treasury bond that the federal government issues, carries risk. Any student of history knows that governments and civilizations fail.

FDIC backing is hardly a unique protection. Every Treasury bond is issued and backed by the federal government, the same debt-laden organization that stands behind the FDIC. Plenty of other nearly equivalent safe lending investments yield higher returns than bank accounts. Highly rated corporate bonds are good examples (see Book 4 for more on bonds). That’s not to say that you shouldn’t consider keeping some of your money in a bank. But first, you should be aware of the realities and costs of FDIC insurance.