Thursday, June 4, 2009, AM | 6 Comments
On Wednesday afternoon, the President signed this bill into law. The extension of the $250K coverage to 12/31/2013 is now official. On Tuesday both the House and the Senate passed an amended version of Bill S.896 which includes a provision to extend the temporary increase in deposit insurance from December 31, 2009 to December 31, 2013. This applies to both Federal Deposit Insurance Corporation (FDIC) and National Credit Union Administration (NCUA).
Consumers who want to safeguard their money in these extremely bad economic times will benefit from the four-year extension of $250,000 FDIC deposit insurance per depositor on individual accounts. The insurance limit was slated to roll back to $100,000 Jan. 1, 2010, but Congress has extended the deadline through Dec. 31, 2013. As things stand now, the standard insurance coverage will revert to $100,000 per depositor Jan. 1, 2014.
The original increase from $100,000 to $250,000 was announced last October as consumers were losing faith in the financial markets and the banking system. Congress wanted to assure consumers that their funds were safe in the nation’s FDIC-insured banks and NCUA-insured credit unions.
In a Nutshell
The rules for revocable trust accounts can be complicated; be sure to review the FDIC’s latest information.
For a more detail description, click on summary of this bill including the deposit insurance provision.
As always, credit union and bank-held retirement accounts, such as IRAs, remain insured for $250,000 per depositor. Congress permanently increased protection on those accounts April 1, 2006.
Like everything else, U.S. Congress has evolved through generations. In some cases, it has seemingly lost all or most of their original function. The $100K limit is a joke today, given the effects of inflation. Yet with this law it remains in place, only just delayed. I would love to know what constituency, what political forces, acted to kill the permanent $250K limit.Facebook.com/doable.finance