Is my money safe? What you need to know about bank failures.

Recent failures of Silicon Valley Bank and Signature BankThat caters to most of the tech industry, you might be worried about your money. These were the second and third largest bank failures in US history.

It all started last week when a large number of depositors tried to withdraw their money from a Silicon Valley bank at once, leading to a bank run.

The bank had to sell Treasury bonds and other securities at huge losses to provide customers with their cash, and word of this quickly spread on social media, contributing to the bank’s sudden failure. Regulators took control of New York-based Signature Bank soon after, saying it was important to protect depositors after so many people withdrew their money.

In response, regulators guaranteed all deposits at both banks and created a program to help protect other banks from a run on deposits.

Here’s what you need to know about your money.

Are my deposits safe?

Yes, all deposits up to $250,000 are insured. Federal Deposit Insurance Corporation The FDIC also has a solid track record of insuring deposits above its limits.

Almost all banks are FDIC insured. You can find the FDIC logo on bank teller windows or at the entrance of your bank branch.

Insured by credit unions National Credit Union Administration.

Individuals or businesses raising large sums of money are encouraged to spread the funds among various financial institutions.

Federal authorities have put measures in place to ensure that customers of other banks don’t panic and withdraw their deposits.

Will my bank fail?

If you’re worried about your bank closing in the near future, there are tell-tale signs of a bank that’s in trouble, according to Caleb Silver, editor-in-chief of investment site Investopedia.

He recommends that bank clients:

  • Look at the stock price of the bank.
  • Keep an eye on the bank’s quarterly and annual reports.
  • Set up a Google Alert for the bank to monitor news coverage.

Pay close attention to your bank’s behavior, Silver said.

“If they’re trying to raise money through a share offering or if they’re trying to sell more stock, they may have trouble with their balance sheet,” Silver said.

Should I look for alternatives?

If you have more than $250,000 in the bank, there are a few things you can do, including, secondly, opening a joint account.

According to Greg McBride, Bankrate’s chief financial analyst, you can protect up to $500,000 by opening a joint account with a spouse.

“A married couple can easily protect a million dollars by each having an individual account at the same bank and a joint account together,” he said.

You can also open accounts at other financial institutions to spread out your deposits so that each is covered by the FDIC insurance cap.

Do not withdraw cash.

Despite the recent turmoil, experts don’t recommend withdrawing cash from your account. It’s safer to keep your money in the bank than in your home, especially when it’s insured.

“This is not the time to take your money out of the bank,” Silver said.

The DOJ is investigating Silicon Valley Bank, while consumers continue to question the future of finance.


Even people with uninsured deposits usually get almost all of their money back.

“It takes time, but generally all depositors — both insured and uninsured — get their money back,” said Todd Phillips, a consultant and former FDIC attorney. “Uninsured depositors may have to wait a while, and take a haircut where they lose 10 to 15% of their savings, but it’s never zero.”

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