Most people have heard of the Federal Deposit Insurance Corporation (FDIC), which protects bank customers’ accounts in the event of a bank failure. But many people are still confused about how credit unions insure accounts for their members. “Are credit unions insured like banks?” is one of the most popular questions we’re asked by people who are thinking about joining VyStar.
Are Credit Unions Insured?
The short answer is yes — credit union accounts are insured, just like bank accounts. While there are some differences between banks and credit unions, they’re very similar when it comes to keeping your money safe and secure. Accounts at VyStar, like all federally insured credit unions, are protected by the National Credit Union Share Insurance Fund (NCUSIF), which is provided through the National Credit Union Administration (NCUA).
What is Covered by the NCUSIF?
Just like the FDIC, the NCUSIF is “backed by the full faith and credit of the United States government.” That means that the U.S. Treasury can reimburse you if your credit union fails. Both NCUSIF and FDIC insurance provide up to $250,000 in coverage to each share owner, per insured credit union, for each account ownership category: checking, savings, and money market accounts; IRAs; and certificates.
Individual accounts, which are owned by one person, are insured up to $250,000 for the combined balances in that individual’s savings, checking, certificates and money market accounts at a single bank or credit union.
Joint accounts are owned by two or more individuals. Each owner on the account is insured up to $250,000 for all joint accounts in a single bank or credit union.
Individual Retirement Accounts (IRAs) are treated separately. They are personal savings plans that allow you to set aside money for retirement. The combined balances in a single bank or credit union for Traditional, Simplified Employee Pension (SEP) and Roth IRA plans are insured separately from other accounts at that bank or credit union up to $250,000.
Neither NCUSIF nor FDIC insurance protects investments, such as stocks, bonds, mutual funds, annuities or life insurance policies. Safe deposit boxes and their contents are also not covered by NCUSIF and FDIC insurance.
If you’re not sure if all your accounts are covered, take a look at the NCUA insurance estimator. This tool can you help you determine if you have adequate insurance at an NCUSIF-insured credit union.
Are All Credit Unions NCUSIF-Insured?
The vast majority of credit unions are federally insured, but a few are privately insured. Credit unions that are NCUSIF-insured are required to display the official “NCUA Insurance” logo and signage, so look for it the next time you visit your credit union branch or website. Or, you can always ask.
At VyStar, your accounts are safeguarded by the NCUA and the federal government. If you have any questions about VyStar membership, our representatives are always happy to help you get the information you need. Just visit your nearest branch or call us at 904-777-6000 or 800-445-6289.
Safety Is Just One of the Benefits
Credit unions are a great place to keep your money safe. Not only are they secure, but they also provide additional benefits to members, such as higher-interest savings accounts and lower-interest loans than those offered at banks. Credit unions are also owned by their members — not by stockholders, like banks are — so our goal is to serve you and your financial interests. Visit our comparison page to learn more about the credit union difference.