Average person doesn’t need to worry about their bank collapsing, financial advisor says
CHARLOTTESVILLE, Va. (WVIR) - Silicon Valley Bank and Signature Bank ran into some trouble, and now some are worried about their own money in the bank.
These two banks no longer have enough money on hand to pay the people who were asking for it back.
Emergent Financial Services CEO Alex Urpi says there is no need to rush to take out your cash.
“For the average person, I would say I wouldn’t worry particularly much. It’s not as though these things can’t happen here, but the the average person typically doesn’t have more than $250,000 at a single bank,” Urpi said Monday, March 13. “I think the two things for the average person to think about are make sure your bank is FDIC insured, and if it’s not, consider whether you have a good reason to be there.”
An FDIC bank helps keep your money protected if the bank collapses.
“If you’re at a bank, a major bank, that is FDIC insured, you’re insured for up to $250,000 per person,” Urpi said. “If by chance you do have more than $250,000 of savings, open a second bank account at a different bank because it per bank.”
Urpi says these two bank collapses in the same week are out of the ordinary compared to how banks operate in central Virginia.
“This was kind of a scenario where they really wanted to make a little extra money on their deposits, and they got hit hard by rising interest rates. A lot of banks are probably playing it a little bit safer than that,” Urpi said. “This is not a scenario like 2008, where mortgages really across the board were being basically foreclosed.”
Urpi says the best way to know if your bank is FDIC insured is to call up the bank and ask.
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