Is Your Money Safe in a Bank?

As your business becomes more profitable, you might have questions about the best way to store your money so you have little chance of losing it. This is an especially common concern during hard times, such as a recession or global pandemic.

So is your money safe in a bank? Well, experts say the bank is absolutely the safest place to store your funds. Here are the main reasons for this:

FDIC Insurance

The top reason you should put your money in the bank for safe storage is that it’s insured. Legitimate banks must have insurance from the Federal Deposit Insurance Corporation (FDIC) to keep their customers’ money safe. The FDIC will cover the money you have in your checking, savings, or money market accounts — as well as certificates of deposit — up to $250,000.

Even if your bank were to be robbed of cash, you wouldn’t lose your money. You’d get back every dollar up to $250,000. If you have more than that to put into a bank, you can open accounts at multiple banks to ensure that you get FDIC insurance coverage for all your money.

NCUA Insurance

If you’re wondering if this type of insurance applies if you use a credit union, it does. Granted, credit unions have coverage through the National Credit Union Administration (NCUA) rather than the FDIC.

But it’s the same concept as the FDIC, with the same limit of $250,000. Just as with a bank, if you have more than $250,000 to deposit and want to make sure it’s all insured by the NCUA, you can open accounts at a variety of credit unions.

Dangers of Keeping Cash at Home

If you feel more comfortable storing cash in secret spots around your home than depositing it in a bank, think about what could happen if someone burglarized your house. There’s a good chance a thief would find your secret stash of cash and take it, leaving you without the money you may have been saving up for years.

Homeowner’s insurance may cover cash, but usually only up to about $200 since it’s so hard to prove how much you have in the house. Compare this to a bank’s insurance limit of $250,000 and you’ll see that banks are a safer bet.

The same goes for if a flood or fire damages your home. At that point, all your cash — except maybe the $200 that homeowner’s insurance might reimburse you — will vanish forever. That’s not the case if a fire or flood damages a bank or credit union — you get back every penny up to the limit.

As you can see, your money is safe at a bank. As long as you choose the right financial institution for your needs, your banking experience will be just as easy as stashing cash around the house — but your money will be much more secure!

Disclaimer: Vinings Bank has made this blog available solely for informational purposes. Its content is general in nature and does not constitute professional advice. Furthermore, the views expressed in this blog are not necessarily those of the bank, and Vinings Bank does not make any representation or warranty as to the accuracy or completeness of the information contained in this blog. Any liability, therefore, is expressly disclaimed. The information in this blog may not be current, and Vinings Bank does not undertake any obligation to update such information. No part of this blog may be reproduced, redistributed, published, copied, or duplicated in any form without the express consent of Vinings Bank.