Delta Community sometimes receives inquiries from its members about its financial health and if members’ deposits are insured in some way. The deposits of Credit Union members are insured through a program backed by the United States government that some of our members may not be aware of, but it’s important to understand how the program operates and the protection it provides.
How Delta Community members’ deposits are insured
- The basic insured amount for a credit union member under current federal law is $250,000.
- The deposits of Delta Community Credit Union members are insured by the National Credit Union Administration (NCUA) and its National Credit Union Share Insurance Fund (NCUSIF).
- The NCUA is an independent agency of the United States government. NCUA insurance helps to maintain sound conditions in the credit union industry and protects credit union members if an insured credit union fails due to insolvency or bankruptcy, a status which is determined by the National Credit Union Administration Board.
- Details on the insurance coverage for credit union members provided by the National Credit Union Share Insurance Fund are available the Fund’s website. A comprehensive booklet entitled Your Insured Funds is available on the ncua.gov and MyCreditUnion.gov websites. This booklet contains a detailed discussion of all available types of NCUSIF coverage
- According to the NCUA, “The Share Insurance Fund has the backing of the full faith and credit of the United States. Credit union members have never lost even a penny of insured savings at a federally insured credit union.”
- The Share Insurance Fund also separately protects members’ Individual Retirement Account (IRA) and KEOGH retirement accounts up to $250,000 and provides additional coverage for members’ trust accounts.
What if I have more than one credit union account and what if I have cumulative assets greater than $250,000?
- Share accounts maintained in different rights, capacities, or form of ownership may each be separately insured up to $250,000. This means that a member may hold or have an interest in more than one separately insured share account in the same insured credit union.
- Individual account coverage can be extended beyond the basic $250,000, through a variety of methods, including joint ownership, naming a payable-on-death beneficiary, or the creation of legal trusts.
- In terms of insured amounts, it may not be necessary to separate and diversify assets between different financial institutions, and it may be more efficient to consolidate funds among just a few (or only one) credit unions or banks.
- The NCUA has a tool, its interactive Electronic Share Insurance Estimator, to help credit union members better understand the protection offered by the NCUSIF. The online tool lets credit unions and their members input data to compute the amount of NCUSIF coverage available under different account scenarios; this will let them know how its share insurance rules apply to member share accounts—what's insured and what portion (if any) exceeds coverage limits.
- The Share Insurance Estimator is a particularly useful tool for members to determine if they have their funds properly structured to provide the maximum available insurance coverage. If a member needs the tool to manage a significant amount of assets, then they may want to also consider working with a financial advisor. Delta Community has a team of CERTIFIED FINANCIAL PLANNER™ professionals available to offer advice and discuss options for allocating assets so its members can make informed monetary decisions for every stage of their life, including during periods of economic instability.
The above information is not comprehensive, but touches on just some of the key program aspects and tools of the NCUA and NCUSIF. More information is available from their websites.
Does Delta Community have other timely financial information? That is a good question…
For more information that may help you manage your finances at any age and in different life situations, please check out the free Delta Community Financial Education Center webinars on a range of prudent and useful financial topics. Please visit the Financial Education Center's Events & Seminars page to register for its on-demand webinars.
The Credit Union’s blog has more information that could be educational and helpful: