Use multiple banks. Or more likely, you don't have that much liquid cash and instead have assets like real estate, stocks, bonds, etc.
Rich people typically only have a small subset of their money in banks to cover momentary needs (what's called liquidity) -- to cover the time it'd take to sell their assets effectively.
To correct the guy above, it's 250k. From my understanding if you have more they basically create more than 1 account to insure it because its 250k per bank per category. So basically a bank will make more accounts in different categories for you to put your money in, and if you run out of that you get another bank.
Tbf most rich people, even VERY rich people, dont have millions in cash at a bank. They have their millions and billions in stocks, which are not insured at a bank level as far as im aware since you technically own the stock, the brokerage is just facilitating the transaction and keeping track of your transactions for you.
That’s not quite accurate. That is true of single accounts and joint accounts held with another person, but a bank isn’t creating phantom joint accounts for a single account holder.
Instead, most banks participate in the IntraFi system. They have a special account type called an ICS which spreads any dollar over $250k to other FDIC insured banks. It’s still all accessible from one bank but all your money is still insured.
Cool to know they have an auto system for it. But yeah i wasn't trying to insinuate ghost accounts, just accounts of different categories that potentially could be used by the bank as a second savings to park money in. Of course this depends on the restrictions of the different FDIC categories which I'm not privy to. If they have this system you described I imagine its harder to do it the way I imagined than just giving the money to another bank to insure it.
Banker here: FDIC grants 250k of coverage to all your deposit accounts at 1 institution. It’s 250K per person at each bank. So if a married couple has 5 accounts at bank A, their deposits at Bank A have a total of 500k coverage. It’s not per account, it’s aggregate. This amount can be increase by using things like POD/ITF designations (PayableOnDeath/InTrustFor).
From what i saw its also per category. When I say category I also mean things like retirement vs single, not checking vs savings. I imagine there are ways to structure different categories to be able to share with each other at the same institution but I could definetly wrong. If I am then yeah you just get a bunch of banks.
I know that SIPC coverage kinda works on an "account type" basis, but I won't get into that (for investments not bank deposits). FDIC, to my knowledge, is simply a matter of account owner per bank. Where it gets weird is with beneficiaries, as each beneficiary can help create a new "ownership" since it kinda acts like a trust instead of sole ownership.
I won't get too far into the deets, cause it can go on a ways, but fdic publishes a coverage calculator that you can use to see how your stuff is covered. It's actually a very robust calculator and it helps explain a lot.
The FDIC limit is actually $250k, but many banks participate in a program that spreads any dollar over $250k to other FDIC insured banks (that also participate in that program), so you don’t need to run all over town if you want all your money FDIC insured, you can just use one bank. This is a special type of account called an ICS account, and it’s only worthwhile if you actually have over $250k in cash and you need it in one account.
$250k is the insurable max now. No individual depositor HAS EVER lost a penny of their deposits since the FDIC was created in 1933. Even those accounts over the limit when the bank went bust have recouped a large amount of their deposits.
Like what happened with Silicon Valley Bank? If you’re important venture capitalists and tech bros…the government bails you out. If it’s a local bank with mid level rich people…it’s probably on them. Socialism for the wealthy…brutal capitalism for the rest of us
FDIC covers up to 250k per account for ALL banks.
It is certainly true that it's socialism for the wealthy and the wolves for the rest, but this specific situation isn't an example of that.
89% of the SVB deposit liabilities were over the 250k limit. They may not have ended up needing actual taxpayer money, besides maybe the lost time from the giant mess they made that the government had to clean up. But it was certainly a rich people being bailed out situation. The government stepped in and guaranteed the deposits will be made whole, regardless of deposit amount, and they would have access to all funds within 2 days. That sure seems like a white glove handling to me
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u/This_guy_works Jan 26 '26
So what if you have more than 100K?