Given the recent meltdown in the credit markets it’s important to keep a cool head and garner a good understanding of just what is and what isn’t protected by government agencies.

First of all, under FDIC:

• Bank accounts under $100,000 per person (per bank) are fully insured
• Certain retirement accounts, such as an IRA are fully insured up to $250,000 (per bank)
• Some bank money markets (not to be confused with mutual fund money markets) may be insured to the same amounts

Under SIPC:

• Marketable securities (stocks, bonds, mutual funds, etc.) up to $500,000 per firm are fully insured, this may include up to $100,000 in cash
• SIPC insurance DOES NOT cover losses due to valuation fluctuations – they cover for example that if you own 100 shares of Google (GOOG) you’ll still have 100 shares of GOOG available even if your firm goes under, but if Google stock drops in half they do not insure the loss of value

You can learn more through the Financial Industry Regulatory Authority (FINRA) here http://www.finra.org/Investors/ProtectYourself/InvestorAlerts/P116996