Yes, money market accounts held at FDIC-insured banks are covered up to $250,000 per depositor, per bank

The Federal Deposit Insurance Corporation (FDIC) protects money market accounts the same way it protects regular savings accounts. If the bank fails, the FDIC will reimburse you for the money in that account up to the insurance limit. This protection is automatic — you do not need to sign up for it or pay a fee.

The key word is "per bank." If you have a money market account at Bank A and a savings account at Bank A, they share the same $250,000 limit. But if you have money market accounts at two different FDIC-insured banks, each account gets its own $250,000 protection.

Money market accounts at credit unions are covered differently. Credit unions use the National Credit Union Administration (NCUA), which also insures up to $250,000 per member, per credit union. The coverage works the same way, but the agency is different.

Key Takeaways

  • FDIC insurance covers money market accounts at banks up to $250,000 per depositor, per bank, and this protection is automatic.
  • If you have multiple accounts at the same bank, they share the $250,000 limit unless they are in different ownership categories (like individual versus joint).
  • Money market accounts at credit unions are insured by the NCUA, not the FDIC, but the $250,000 limit per member applies the same way.
  • Not all money market accounts are FDIC-insured — accounts at non-bank investment firms or brokerage houses are not covered by the FDIC.

How the $250,000 limit works when you have multiple accounts

The FDIC limit applies per depositor, per bank. This means if you have $150,000 in a money market account and $120,000 in a checking account at the same bank, you are only covered for $250,000 total — you would lose $20,000 if the bank failed.

However, the FDIC recognizes different ownership categories, and each one gets its own $250,000 limit. A money market account in your name alone is separate from a joint money market account you share with your spouse. A money market account you hold in trust for someone else is also separate. If you have all three at the same bank, each one is covered up to $250,000.

This matters if you are trying to protect a large amount of money. You cannot simply split $500,000 between two money market accounts at the same bank and expect both to be fully covered — they would share one $250,000 limit. But you could open one account in your name and one joint account with your spouse, and both would be fully covered.

Which money market accounts are not FDIC-insured

FDIC insurance only covers money market accounts at banks and credit unions. If you open a money market account through a brokerage firm, investment company, or insurance company, it is not FDIC-insured, even if that firm also operates a bank.

Some large financial companies have both a bank division and an investment division. Their bank division's money market accounts are FDIC-insured. Their brokerage division's money market accounts are not. The names can be confusing — you need to check whether the account is held at the bank or at the investment side of the company.

You can verify whether a bank is FDIC-insured by searching the FDIC's Bank Find tool on their website. Enter the bank's name and your state, and the tool will tell you whether it is insured and what the current coverage limits are.

What happens to your money if the bank fails

If an FDIC-insured bank fails, the FDIC steps in and either arranges for another bank to take over the failed bank's accounts or pays out the insured deposits directly. In most cases, you keep access to your money within a few business days — either through the new bank that took over, or through a check from the FDIC.

The FDIC has never failed to cover insured deposits since the agency was created in 1933. The insurance fund is backed by premiums that banks pay to the FDIC, not by taxpayer money, though Congress can authorize borrowing if needed.

If your account balance exceeds the $250,000 limit, only the amount within the limit is covered. The excess is treated as a claim against the failed bank's assets, which may recover some or all of it, but there is no may provide.

FDIC coverage for money market accounts in different ownership structures

The FDIC recognizes several ownership categories, each with its own $250,000 limit at the same bank:

  • Single ownership (account in your name alone)
  • Joint ownership (account shared with one or more other people)
  • Revocable trust (money market account held in trust, where you name beneficiaries)
  • Irrevocable trust (money market account in a trust you cannot change)
  • Retirement accounts (IRAs, SEP-IRAs, and similar accounts)
  • Accounts held for a minor (Uniform Transfers to Minors Act accounts)

If you have a money market account in your name and a separate joint money market account with your spouse at the same bank, both are covered up to $250,000 each. The joint account is covered as a separate category.

Retirement accounts like IRAs held in a money market account are also covered separately. A traditional IRA in a money market account gets $250,000 of coverage, and a Roth IRA in a money market account at the same bank gets another $250,000 of coverage.

How to confirm your money market account is FDIC-insured

Before you open a money market account, confirm that the bank is FDIC-insured. Look for the FDIC logo on the bank's website or ask a representative directly. The bank is required to disclose its FDIC status.

You can also search the FDIC's Bank Find tool at fdic.gov. Enter the bank's name and the state where you plan to open the account. The tool will show you the bank's FDIC certificate number and confirm that it is insured.

If you already have a money market account and want to verify it is covered, log into your account or call the bank and ask whether your account is FDIC-insured and what the current coverage limit is. The bank should be able to tell you immediately.

Frequently Asked Questions

Can I have more than $250,000 in a money market account and still be fully covered?

Only if you split the money across different banks or different ownership categories at the same bank. A single money market account in your name at one bank is covered only up to $250,000. If you have $300,000, the extra $50,000 is not covered by FDIC insurance.

Does FDIC insurance cover money market accounts at online banks?

Yes, as long as the online bank is FDIC-insured. Many online banks are FDIC members and offer the same $250,000 coverage as brick-and-mortar banks. You can verify this using the FDIC's Bank Find tool.

What is the difference between FDIC and NCUA insurance?

FDIC insures banks, and NCUA insures credit unions. Both provide $250,000 of coverage per member, per institution. The coverage limits and rules are the same; only the agency administering the insurance is different.

If I have a joint money market account with my spouse, is it covered for $250,000 or $500,000?

A joint account is covered for $250,000 total, not per person. The FDIC insures the account itself, not the individual owners. If you want both you and your spouse to have separate $250,000 coverage, you would each need your own individual account at the same bank.

Are money market accounts at investment firms covered by FDIC insurance?

No. FDIC insurance only covers accounts at banks and credit unions. Money market accounts held through a brokerage, investment company, or insurance company are not FDIC-insured, even if that company also operates a bank.