How Safe Is Your Credit Union? | Will NCUA Insurance Protect Your Money
Credit Union
If you are a credit union member, you may wonder how safe your money is in a financial or natural disaster.
Unlike banks, which are insured by the Federal Deposit Insurance Corporation (FDIC), credit unions are insured by the National Credit Union Administration (NCUA).
This federal agency regulates and supervises credit unions.
The NCUA operates the National Credit Union Share Insurance Fund (NCUSIF), which covers up to $250,000 per depositor, per insured credit union, for each account ownership category.
If your credit union fails, you will not lose money up to the insured limit.
The NCUSIF is backed by the full faith and credit of the United States government, so you can rest assured that your funds are secure.
What Does NCUSIF Cover?
The NCUSIF covers most types of accounts at a credit union, such as regular shares, share drafts, money market accounts, certificates of deposit, and individual retirement accounts.
However, some types of accounts are not covered by the NCUSIF, such as mutual funds, stocks, bonds, annuities, life insurance policies, and any uninsured investments they may offer.
To make sure that the NCUSIF protects your money, you should check that the NCUA federally insures your union.
You can do this by looking for the NCUA logo on your union’s website or at its branch locations.
You can also use the NCUA’s online tool to determine if it is federally insured and how much of your money is covered.
The Best Way to Keep Your Money at a Credit Union
If you have more than $250,000 at a single institution, you may be able to increase your coverage by opening different types of accounts or by using different ownership categories.
For example, you can have up to $250,000 in an individual account, $250,000 in a joint statement with another person, and $250,000 in an IRA account.
You can also use a trust or payable-on-death account to name beneficiaries who will receive your money after your death.
However, you should consult your financial advisor before making any account changes.
Conclusion
By choosing a federally insured institution and understanding how the NCUSIF works, you can enjoy member benefits without worrying about losing your hard-earned money.
The NCUA is committed to ensuring that your money is safe and sound and that your deposits are protected. For more information about the NCUA and the NCUSIF, visit www.ncua.gov.
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Category: Credit Union
