Accounts w/ 2 or more banks essential?

[scfr]

According to the Wall Street Journal, the FDIC is beefing up its preparedness for "...well over 100 bank failures in the next 12 to 24 months..."

I like to keep my cash in more than one bank. Thanks to FDIC insurance, I'm not terribly worried about not getting my money back eventually following a bank failure, but I do worry about a gap of time when I couldn't get my hands on any cash.

I wonder how quickly the FDIC would be able to reimburse people if they were slammed with multiple bank closures at once?

What do the rest of you think? Is it okay to have all of your cash in one bank, or is it important to spread your cash around among two or more banks?

[PrincessPerky]

The old saying 'never put all your eggs in one basket' comes to mind.

Though having said that...I am not sure different banks are really different 'baskets'...

[Aleta]

I heard about that last night. I have been looking for the article. It sure gave me pause to think. From what I hear, they are not going to be paying you initerest while you wait on your money from them. Where did you find that information.

[sweeps]

I just deal with one bank now. One bank is enough -- keeping track of everything and meeting minimum banking requirements can be a real pain otherwise.

Someone pointed out in another thread that the availability of credit cards kinda alleviates the problem of not having access to your money for a few weeks.

But you should keep some cash in a safe place just as an extra backup.

[scfr]

I heard about that last night. I have been looking for the article. It sure gave me pause to think. From what I hear, they are not going to be paying you initerest while you wait on your money from them. Where did you find that information.

Aleta - It was an article titled "FDIC Readies for a Rise in Bank Failures" on Page A2 of yesterday's Wall Street Journal (Feb 26).

[scfr]

[QUOTE=sweeps;152752]

Someone pointed out in another thread that the availability of credit cards kinda alleviates the problem of not having access to your money for a few weeks.

QUOTE]

But what about paying the rent?

[Aleta]

scfr: Thank you for the name of the article. They also talked about 75 banks that could be in trouble. Does that article mention them?

[scfr]

scfr: Thank you for the name of the article. They also talked about 75 banks that could be in trouble. Does that article mention them?

Aleta - The article did not mention the names of the "problem" banks.

I just remembered that business accounts are not FDIC-insured ... I must have a little chat with my husband about his one and only business acount when he gets home! It might not be a bad idea for him to split his business funds between 2 banks, just in case. (Not put all of his eggs in one basket, as PrincessPerky said.)

***CORRECTION: Business accounts may or may not be FDIC-insured. Sorry for misspeaking.*****

[Aleta]

Thank you. I found the article by googling it. Didn't know that about business accounts. That is information that my husband and I need to know. I wonder how many people are aware of that?

[sweeps]

But what about paying the rent?

Point taken. I guess you explain the situation to your landlord and hope he gives you a break. If not, then you eat the $50 late-payment fee.

IMO, this is one of those risks that is too remote to inconvenience myself over. Life is chock full of risks -- you have to choose which ones are worth the time, energy and money to protect yourself from.

[scfr]

If not, then you eat the $50 late-payment fee.

.

I will go out on a limb and guess that you are not a renter.

If we pay late, we lose our "rent concession" (what we pay for having a lease vs. "market rate") of $159, pay a late fee of $50 for the first day, and $15 per day thereafter.

So, the tab for paying 7 days late would be $299, and the tab for paying 14 days late would be $404.

As you implied, it would depend on your own situation and whether or not you want to deal with the worst case scenario of what could happen if you could not get your hands on some cash for awhile. For me, the price is too high. It costs me nothing to have 2 or more bank accounts, and for me paying nothing in exchange for a whole lot of peace of mind is worth it!

[disneysteve]

this is one of those risks that is too remote to inconvenience myself over.

Agreed. Sure, a bank could go under, but FDIC would cover your deposits.

I have money in multiple places anyway - checking account, money market accounts (plural), mutual fund accounts, retirement accounts, etc. If the bank that has my checking account closed up, I have plenty of other places I could get money until the FDIC took care of me.

If all I had was my checking account (and I remember those days - it wasn't that long ago), I still wouldn't go splitting up what little I had just in case. Just too much trouble for so small a risk.

[Scanner]

And you guys laughed at my patient who buries silver in coffee cans in his backyard

[sweeps]

And you guys laughed at my patient who buries silver in coffee cans in his backyard

And I'm still laughing...

So, the tab for paying 7 days late would be $299, and the tab for paying 14 days late would be $404.

G-- D---, are you renting out the Taj Mahal?

Still I would consider other sources of money as Steve pointed out. For example I could always borrow from my MIL in a pinch if necessary.

[scfr]

G-- D---, are you renting out the Taj Mahal?

That's funny, because I actually thought of explaining in my previous post "this is not the Taj Mahal" Nope ... It's a one BR / one BA in a lil' ol' 'burb in Texas!

BTW, an account in a 2nd bank does not have to be a checking account. It can be a MMA,a CD, anything you can get your hands on if your primary bank folds. I have a secondary checking account that I had to open and link to a MMA. I maintain a $0 balance in it (am allowed to do that and not pay any fees). I had thought of it as a minor nuisance (have to keep a file on it, and remember to close it should I close the MMA), but now I'm going to think of it as my "backup emergency checking account."