FDIC Insurance and Your College Accounts

With the recent meltdown of IndyMac Bank and the near collapse of Bear Stearns, many parents and grandparents are starting to feel a little nervous about the safety of their nest eggs. Others are letting it roll off their backs, telling themselves that the government's FDIC program protects everyone's investments.

Individuals at both extremes could probably use a little refresher course on what FDIC coverage does and does not cover.

For example, did you know:

FDIC Insurance doesn't cover mutual funds, which may include your money market account?

The coverage limit of $100,000 per individual is raised to $250,000 for retirement accounts.

Coverdell ESA's are not considered retirement accounts even though they were previously called Education IRA's.

Your Wall Street brokerage account and Section 529 account are not covered under FDIC.

For a more detailed explanation, be sure to check out my full-length article reviewing FDIC insurance coverage.

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