Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been previewed, commissioned or otherwise endorsed by any of our network partners.
The Federal Deposit Insurance Corporation, or FDIC, is the government agency that insures customer deposits in banks and thrift institutions. The National Credit Union Administration, or NCUA, insures deposit accounts at federal credit unions.
For all intents and purposes, the types of coverage the two agencies provide are identical. Both offer insurance of up to $250,000 per depositor, per institution, per account category. We’ll dive deeper into the differences between the two agencies, the protection they offer and how to maximize your deposit insurance coverage.
The main difference between the Federal Deposit Insurance Corporation and the National Credit Union Administration are the institutions they insure. Both are federally backed institutions with functions and limitations that are virtually the same.
|FDIC vs. NCUA Insurance|
|Who is insured?||Banks||Credit unions|
|How much is insured?||$250,000 per account owner, per institution, per ownership type|
|What accounts are insured?||
|What ownership types are insured?||
|What accounts are not insured?||
Both NCUA and FDIC insurance cover up to $250,000 per account owner, per institution, per ownership type. That means that if you own a single savings account without a joint owner or beneficiary at Bank A, the money in that account is insured up to $250,000. Any money above the $250,000 threshold in that account won’t be insured.
It’s helpful to understand which kinds of accounts qualify for NCUA or FDIC insurance — and which ones don’t. In addition to the insured accounts listed in the table above, FDIC and NCUA insurances also cover:
We specify “deposit retirement accounts” above because not all IRAs, 401(k) plans or KEOGH accounts are FDIC- or NCUA-insured; those that are investment accounts are not insured.
Speculative investments are never insured by the FDIC or NCUA. In addition to the uninsured accounts listed in the table above, speculative investments include:
Certain investments are still insured, just by the Securities Investor Protection Corporation (SIPC).
It’s important to note that not all credit unions are NCUA-insured, nor are all banks FDIC-insured.
The NCUA automatically insures federally chartered credit unions, which you can check for if the credit union has “federal” in its official name. State-chartered credit unions may opt into NCUA insurance, but are also regulated by the state authority in which it was chartered. To check whether a credit union is NCUA-insured, you can ask a credit union representative or look for the NCUA sign at the credit union or on its website. You can also search for your credit union using the Credit Union Locator.
Meanwhile, most banks are FDIC-insured, but you can check its insurance status using the FDIC’s BankFind tool, calling the FDIC at 877-275-3342, asking a bank representative or checking the bank’s website or branch for Member FDIC signage.
There are a few ways to make sure you’re insured for as much as possible with both NCUA and FDIC insurance. Specifically, this includes the following:
Here’s a look at how you can have much more than $250,000 insured if you spread out your money between different accounts and ownership types:
|A Look at How You Can Increase FDIC and NCUA Coverage|
|Account type||Single ownership||Joint ownership (two owners)||Deposit insurance|
|Funds in Bank A||$100,000 in a savings account with two beneficiaries||$100,000 in a checking account||$500,000 for the single savings account
$500,000 for the joint checking account
|Funds in Credit Union Z||$5,000 in CDs|
$5,000 in a money market account
|$10,000 in a savings account with one beneficiary||$250,000 for the single owned CDs and MMA
$500,000 for the joint savings account
Total FDIC insurance: $1 million