U.S. government securities—such as Treasury notes, bills, and bonds—have historically been considered extremely safe because the U.S. government guarantees timely payment of interest and principal, backed by its full faith and credit.
Money market account
A money market account can be a safe place to park extra cash and earn a higher yield than from a traditional savings account. Money market accounts are like savings accounts, but they often pay more interest and may offer a limited number of checks and debit card transactions per month.
A physical safe is a popular option for storing money without a bank. Safes offer a secure way to store cash and other valuables at home or in another familiar location.
The first line of defense, federal deposit insurance from the FDIC, has worked reliably to date. To avoid a financial hit if your bank fails, stick to insured institutions and account types, stay under account balance limits and use different ownership arrangements.
A focus on FDIC insurance and Treasury-only money market or bond fund options can help safeguard investments when a banking crisis threatens.
No. As long as your bank offers FDIC insurance -- or your credit union offers NCUA insurance -- you shouldn't spend any time stressing about a potential failure. Additionally, bank failures are very rare, so your bank failing is an unlikely scenario.
If you're looking for the safest place to keep your money, look no further than a savings account. Your money will be insured by the FDIC, and you'll have access to it at any time via an online transfer or a debit/ATM card, depending on the policies of your bank.
Inflation Is Eating Away at Your Funds
According to the Bureau of Labor Statistics, the average rate of inflation from April 2023 to April 2024 was 3.4%. If you've been keeping your money in a savings account with a lower yield than the rate of inflation, you should switch over to a higher-yield account.
While it is legal to keep as much as money as you want at home, the standard limit for cash that is covered under a standard home insurance policy is $200, according to the American Property Casualty Insurance Association.
Millionaires don't worry about FDIC insurance. Their money is held in their name and not the name of the custodial private bank. Other millionaires have safe deposit boxes full of cash denominated in many different currencies.
1. Saving Accounts. There's a good chance you already have a savings account. Like checking accounts, they're federally insured and are generally the simplest and safest place to keep cash in good times and bad.
The most common reason given for having secret savings was so that the money could be used to help fund retirement. Men were more likely to give this as a reason than women.
Ultra-wealthy individuals invest in such assets as private and commercial real estate, land, gold, and even artwork. Real estate continues to be a popular asset class in their portfolios to balance out the volatility of stocks.
Banking regulation has changed over the last 100 years to provide more protection to consumers. You can keep money in a bank account during a recession and it will be safe through FDIC and NCUA deposit insurance. Up to $250,000 is secure in individual bank accounts and $500,000 is safe in joint bank accounts.
Places to Keep Your Short-Term Cash
CDs, high-yield savings accounts, and money market funds are the best places to keep your cash when it comes to interest rates. And Treasury bills still offer decent yields at the lowest risk. Learn how they compare in terms of yield, liquidity, and guarantees.
“While it can be tempting to withdraw all your funds from a bank and keep them at home, banks are typically more secure and offer protection against theft or loss. Plus, keeping money in a bank allows for easier access to funds if needed for emergency expenses or unexpected bills.”
It's a good idea to keep enough cash at home to cover two months' worth of basic necessities, some experts recommend. A locked, waterproof and fireproof safe can help protect your cash and other valuables from fire, flood or theft.
Unauthorized Withdrawals And Improper Charges. Both state and federal laws prohibit unauthorized withdrawals from being taken from your bank account or charges made to your credit card without your express consent having first been obtained for that to occur.
Generally, credit unions are viewed as safer than banks, although deposits at both types of financial institutions are usually insured at the same dollar amounts. The FDIC insures deposits at most banks, and the NCUA insures deposits at most credit unions. Seven banks have failed in 2023 and 2024, and all were insured.
In addition, you can also move money to another financial institution protected by the FDIC. Since it is not the individual that is insured but the account, spreading your money across financial institutions can protect $250,000 per account.
No. Credit unions are insured by the National Credit Union Administration (NCUA). Just like the FDIC insures up to $250,000 for individuals' accounts of a bank, the NCUA insures up to $250,000 for individuals' accounts of a credit union.
Deposits at FDIC-insured banks are covered up to $250,000 per person per account ownership type. For example, a $250,000 certificate of deposit in a single-owner account would be fully insured in the event of a bank failure or liquidation.
So if the bank went bust, you'd receive compensation for savings from the Financial Services Compensation Scheme (FSCS), and still owe the bank the full amount of your debts.