FDIC Limit Increase with Beneficiaries

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Topic Author
boogiehead
Posts: 539
Joined: Wed Sep 27, 2017 11:45 pm

FDIC Limit Increase with Beneficiaries

Post by boogiehead »

My parents were talking to their banker and the banker told them if you have additional beneficiaries with the bank it increases the FDIC limit for another 250K per beneficiary. So for example, if there was a joint account with 2 beneficiaries at the bank the total FDIC limit would be 1 million in deposits vs 500K. Can someone help me confirm if this is true or not?
exodusNH
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Joined: Wed Jan 06, 2021 7:21 pm

Re: FDIC Limit Increase with Beneficiaries

Post by exodusNH »

boogiehead wrote: Thu Mar 23, 2023 4:29 pm My parents were talking to their banker and the banker told them if you have additional beneficiaries with the bank it increases the FDIC limit for another 250K per beneficiary. So for example, if there was a joint account with 2 beneficiaries at the bank the total FDIC limit would be 1 million in deposits vs 500K. Can someone help me confirm if this is true or not?
This will calculate it for you: https://edie.fdic.gov/calculator.html
Topic Author
boogiehead
Posts: 539
Joined: Wed Sep 27, 2017 11:45 pm

Re: FDIC Limit Increase with Beneficiaries

Post by boogiehead »

exodusNH wrote: Thu Mar 23, 2023 4:49 pm
boogiehead wrote: Thu Mar 23, 2023 4:29 pm My parents were talking to their banker and the banker told them if you have additional beneficiaries with the bank it increases the FDIC limit for another 250K per beneficiary. So for example, if there was a joint account with 2 beneficiaries at the bank the total FDIC limit would be 1 million in deposits vs 500K. Can someone help me confirm if this is true or not?
This will calculate it for you: https://edie.fdic.gov/calculator.html
Thanks, appreciate it.
Katietsu
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Joined: Sun Sep 22, 2013 1:48 am

Re: FDIC Limit Increase with Beneficiaries

Post by Katietsu »

I will need to reread the rules again as erp seems to contradict my original post.
Last edited by Katietsu on Fri Mar 24, 2023 6:41 am, edited 1 time in total.
erp
Posts: 565
Joined: Wed Feb 01, 2023 4:19 pm

Re: FDIC Limit Increase with Beneficiaries

Post by erp »

boogiehead wrote: Thu Mar 23, 2023 4:29 pm My parents were talking to their banker and the banker told them if you have additional beneficiaries with the bank it increases the FDIC limit for another 250K per beneficiary. So for example, if there was a joint account with 2 beneficiaries at the bank the total FDIC limit would be 1 million in deposits vs 500K. Can someone help me confirm if this is true or not?
It's not additive as implied by the way the banker said it, but multiplicative (each owner/beneficiary pair gets 1x coverage).

so 2-joint/2-beneficiary is 2x2 = 4 times coverage
but 2-joint/1-beneficiary is 2x1 = 2 which is the same 2x coverage (ie it's not 3x coverage).

also individual/2-beneficiary is 1x2 = 2 times coverage (not 3x)
and individual/1-beneficiary is 1x1 = 1 times coverage (not 2x)

and finally, the 1x coverage for each owner/beneficiary pair is across all accounts for which that pair shows up in that bank.
Topic Author
boogiehead
Posts: 539
Joined: Wed Sep 27, 2017 11:45 pm

Re: FDIC Limit Increase with Beneficiaries

Post by boogiehead »

erp wrote: Fri Mar 24, 2023 12:58 am
boogiehead wrote: Thu Mar 23, 2023 4:29 pm My parents were talking to their banker and the banker told them if you have additional beneficiaries with the bank it increases the FDIC limit for another 250K per beneficiary. So for example, if there was a joint account with 2 beneficiaries at the bank the total FDIC limit would be 1 million in deposits vs 500K. Can someone help me confirm if this is true or not?
It's not additive as implied by the way the banker said it, but multiplicative (each owner/beneficiary pair gets 1x coverage).

so 2-joint/2-beneficiary is 2x2 = 4 times coverage
but 2-joint/1-beneficiary is 2x1 = 2 which is the same 2x coverage (ie it's not 3x coverage).

also individual/2-beneficiary is 1x2 = 2 times coverage (not 3x)
and individual/1-beneficiary is 1x1 = 1 times coverage (not 2x)

and finally, the 1x coverage for each owner/beneficiary pair is across all accounts for which that pair shows up in that bank.
Thanks for spelling out the details... not sure how FDIC came up with this logic
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