Question

Years ago, your great-grandparents lost a significant amount of money during a bank run in the Great Depression. As a result, it has always been important to you to keep your money secure and insured. You recently sold a business and now have $500,000 to set aside. You consult an investment advisor and he offers you some options. Because the safety of your money is the primary concern, the option you choose is:

a. Two separate $250,000 savings accounts at an FDIC-insured bank, one in your name and one in a joint account with your spouse.

b. Two separate $250,000 savings accounts in your name at an FDIC-insured bank.

c. Two separate mutual fund accounts purchased at an FDIC-insured bank, one in your name and one in a joint account with your spouse.

d. Two separate $250,000 municipal bonds purchased at an FDIC-insured bank. For years you have deposited your money in a local community bank. Unfortunately, the bank’s lending policy was lax and last year the bank was forced by the FDIC to close its doors. You had $600,000 on deposit at the bank in a joint savings account with your spouse. The FDIC sold all of the deposits and loans of the failing bank to Wells Fargo, which is a much more stable bank. What affect will this have on your savings account? a. You will receive a $250,000 check from FDIC for the insured amount of your joint account. b. You will receive a $500,000 check from the FDIC, since there were two people on your account. c. You will lose it all because you did not withdraw your money before the accounts were sold to Wells Fargo. d. You will now become a customer of Wells Fargo and will lose no money. e. You will now become a customer of Wells Fargo, but you’ll start over with a $0 balance. You just completed your first week at a new job. It’s Saturday afternoon and your boss hands you your paycheck. To celebrate, you meet friends for dinner. But it’s 8 p.m., the bank is closed and you have no cash. Your account is at the $25 minimum balance, however you have your weekly paycheck in hand. Which two features could you use to get cash for dinner? A. Text alerts of account activity B. Convenient ATM locations C. Electronic deposit of checks from smartphone D. Electronic deposit by employer

Answer 1

1. B. Two separate $250,000 savings account in your name at an FDIC insured bank because federal deposit insurance corporation insures the $250,000 per person in a single bank and FDIC doesn't insures mutual funds even offered by FDIC insured bank. So it's safe to keep $250,000 in two different bank which is FDIC insured in your name.

2. D. You will now become a customer of wells fargo and will lose no money. As the bank has been forced to close its door by FDIC itself due to lax lending policy your money is fully safe with new bank as previous bank didn't filed bank failure so wells Fargo will take care of your $600,000.

3. C. Electronic deposit of checks from smartphone by using mobile banking application and smart phone camera you have to take picture of front and back of paper check then depositing it securely and electronically in your account giving you funds.
B. Convenient ATM locations as some bank offers cashing paycheck in ATM with the help of your card and paycheck with little fees. You can first deposit in your account with the help of ATM and then cash it via card of yours.

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