Is My Money Safe?

By Eileen Lehpamer

My grandparents used to tell me Depression-Era stories about the run on the banks and people keeping their money under their mattresses.

But that was a foreign concept.

Until these past few weeks.

I have now interviewed several people who keep saying the same thing, as a joke, sort of.

One lady today said "I never trust the banks. I'm putting my money in my mattress."

Others say they've already withdrawn hundreds "just to keep at home".

So I asked finance experts today; Is any investment truly safe?

The answer: Yes, if you believe in the United States Government. Mainly the FDIC.

As you know, the FDIC promises to insure an individual bank account up to 100-thousand dollars. But I've also been asked, what if I have more than that? And what happens if numerous banks fail in a one day? Can the FDIC cover them all?

Brad Rock, who is the chairman of the Smithtown Bank and the American Bankers Association, says yes, it can. He says the banking industry has 1.35 trillion dollars behind it. The FDIC, he says, has a 45-billion dollar fund.

Rock also suggested a solution for those with more than 100-thousand who don't want to stick it in the stock market. He says there's a network of 2300 banks that take part in the CDARS Program (pronounced cedars). Basically, if you make a deposit over 100K, the excess is transferred to another bank in the network, and you are covered by the FDIC.

You can find out more about that at : www.cdars.com

Comments

[Rob]

Thanks for the information. Although, I sure wish I had more than 100-thousand to worry about where to deposit it. One day.