High-Net-Worth Deposit Strategies: FDIC Coverage Beyond $250,000

Maximising FDIC coverage on large cash deposits is more structured than spreading across random banks.

The $250,000 FDIC limit is a single-institution, single-ownership-category limit. A married couple can structure multiple times that amount at a single institution through ownership category stacking. The categories the FDIC recognises separately: single ownership (each person), joint ownership (husband + wife together), payable-on-death beneficiary designation (each named beneficiary adds $250,000), traditional IRA (separate), Roth IRA (separate), SEP-IRA, and revocable trust.

A married couple with no other beneficiaries can insure $1,000,000 at a single bank: $250,000 each (individual), $500,000 joint. Add two POD beneficiaries each and the single-institution limit expands to $1,500,000. Add retirement accounts and the number grows further.

For amounts beyond what ownership-category stacking covers, three structured approaches exist:

CDARS (Certificate of Deposit Account Registry Service), now part of the IntraFi network. You deposit at one bank; the bank distributes the funds across IntraFi's member banks in CD increments below $250,000. You receive one account statement. Each chunk is separately FDIC insured. The rate is typically below the best direct CD rates — you pay a premium for the convenience and single-bank relationship.

Separately managed multi-bank ladders. Open accounts at multiple FDIC-insured banks directly. Requires more administrative overhead but captures the best rates at each institution.

Treasury bills and money market funds. Not FDIC insured, but backed by U.S. government obligations and SIPC covered. For amounts beyond the practical FDIC limit, T-bills held at TreasuryDirect or in a brokerage account are the common alternative for large cash positions.

Note: FDIC insurance does not cover brokered CDs differently from direct CDs — both are insured at the issuing bank, not the brokerage. Verify the issuing bank's FDIC status when purchasing a brokered CD.