We all feel the same -- you work hard to earn a living, and when your paycheck goes into an account at a financial institution you want to know it’s safe. Even in the worst case scenario, you want to know you’ll get your money back. That’s why, decades ago the U.S. Government created the FDIC and the NCUA -- the Federal Deposit Insurance Corporation insures bank and thrift accounts and the National Credit Union Administration insures credit union accounts through their respective insurance funds.

Insuring peace of mind

If you’re a credit union member, look for the NCUA sign. It means your money is protected, backed by the full faith and credit of the U.S. government. At NCUA, the National Credit Union Share Insurance Fund is the federal fund that protects members’ share accounts in credit unions across the country, and now members can calculate their level of protection online.

Calculate your account protection 24/7

Credit union members can now use NCUA’s Share Insurance Estimator to determine the amount of share insurance protection provided by the NCUA on the Internet day or night at www.ncua.gov In addition, the estimator offers basic information about share insurance protection, and it explains the various types of account structures available so as your savings grow, you can gain additional federal insurance protection for you and your family above the basic $100,000 level.

The first step is deciding if your savings are insured by the NCUA. By law, any credit union with federal insurance protection on member accounts must post the NCUA sign prominently at each teller station and on its Web site as well. An example of coverage protection

I have $250,000 in my credit union --

*$ 10,000 in my individually owned savings account;

* $120,000 in a joint account with my husband; and

* $120,000 in my revocable trust account (payable-on-death, or POD account) for my daughter and son.

Even though several of these accounts exceed $100,000, the entire $250,000 is insured because of the way the accounts are structured. The coverage protection is as follows:

* $100,000 limit on my individually owned savings account

* $200,000 limit on a joint account with my husband -- each joint owner in a joint account is entitled to $100,000 coverage for his or her interests in all joint accounts

* $200,000 limit on my revocable trust account for my son and daughter

How to gain additional coverage

The example above actually offers a maximum $500,000 in protection. And what’s more, IRA accounts add additional levels of insurance protection. In fact, a family of three can use multiple ownership accounts to increase insurance protection to over $1 million in a single federally insured credit union.

POD revocable trust accounts are an excellent way to expand insurance protection for your family. Each qualifying immediate family member listed as beneficiary gains an additional $100,000 in coverage. POD accounts are not only an excellent way to increase coverage but also a simple way to do so because no formal trust agreements are required.

Want to know more?

Access NCUA’s Share Insurance Estimator on the Internet to learn more about federal insurance protection, and follow the easy to use question and answer format to estimate your own NCUSIF insurance coverage. Depending on the number and types of accounts a member has, the estimator can calculate the insurance on most accounts. Log onto the new Web site at www.ncua.gov and click on the NCUA sign.

Courtesy of ARA Content