The best place to keep your money safe is in a bank. Realize, I did not say make a lot of money, just safe. Banks earn money by taking money from you and other depositors, and then lending the money to other people and businesses for a fee which is called interest. Banks do differ slightly based on how they are organized and which regulatory agency monitors them, although most people are not aware of the differences. Everyone should have, and most people need, a good relationship with a bank. Which one is right for you will depend on your needs and location. Banks offer a number of different kinds of services such as checking accounts (see Types Of Checking Accounts), savings accounts (see Types Of Savings Accounts), ATM cards (see ATM & Debit Cards ), and other ways to help you manage your money. Most bank accounts are insured by the FDIC (Federal Deposit Insurance Corporation) (http://www.fdic.gov/index.html), so you don’t have to worry about losing your money unless you have over a $100,000 in any one account, but we will discuss that later.
The Federal Deposit Insurance Corporation (FDIC) is an independent agency of the United States Government. The FDIC protects depositors (people like you who put money into a bank) against the loss of their insured deposits if an FDIC insured bank fails. FDIC insurance is backed by the full faith and credit of the United States Government.
FDIC insurance covers all types of deposits received at the bank. This includes deposits in checking and savings accounts, money market deposit accounts and time deposits such as Certificate Of Deposit (CD). Acording to the FDIC:
"The standard insurance amount currently is $250,000 per depositor. The $250,000 limit is permanent for certain retirement accounts (includes IRAs) and is temporary for all other deposit accounts throught December 31, 2013. On January 1, 2014, the standard insurance amount will return to $100,000 per depositor for all deposit accounts except certain retirement accounts, which will remain at $250,000 per depositor."
If you want to know more you can read about FDIC insurance coverage online at: www.fdic.gov. If you would like to calculate your insurance coverage, you can use the FDIC's online Electronic Deposit Insurance Estimator at http://www.myfdicinsurance.gov. Whatever bank you use make sure your bank is FDIC-insured. You can check this out yourself by going to: http://www2.fdic.gov/idasp/main_bankfind.asp or calling toll-free 1-877-ASK-FDIC.