Deposit Insurance Increased to $250,000
Sarasota Coastal Credit Union Members:
President Bush has signed into law the financial rescue bill (the “Emergency Economic Stabilization Act,” HR 1424), following the House’s approval. With the President’s signature, the bill is now law of the land.
For credit union members the most significant item in the legislation is the increase in deposit insurance coverage to $250,000 (from the current $100,000). The increase, according to the legislation, will be temporary; in effect until Dec. 31, 2009.
Credit unions continue on the same level as FDIC-insured banks in terms of deposit insurance coverage. This confirms what we have always known, and that is credit unions are safe, sound and solid financial institutions.
The fact is credit unions were not at the root cause of the problems that ultimately led to this legislation; they have been – and continue to be – responsible lenders.
With that in mind, Sarasota Coastal Credit Union continues to provide credit at reasonable rates for prudent purposes and to encourage thrift for its members.
For more information, visit the CUNA website. For more information about credit union federal insurance coverage, visit the NCUA website or the CUNA Consumer website page.
Regarding the more practical aspects about the increase in deposit insurance
The increase to $250k is temporary (as noted, running until Dec. 31, 2009). Further, as indicated, Congress will likely be revisiting the “temporary” issue.
Insurance coverage can actually be much more than $250k. The rules on how account ownership can increase coverage – such as by use of joint accounts and trust accounts – are not being changed.
Finally, be reminded that the $250,000 separate insurance limit on IRAs is unchanged.
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