President Obama signed the bill yesterday to extend the $250,000 FDIC coverage through 12/31/2013. Here is a link to the FDIC annoucement.

This will help, but it really should have been made permanent. This still makes you have to make sure your funds are maturing in the right timeframes.

cd :O)

The US Congress and Senate passed legislation to extend the $250,000 FDIC insurance limit through 2013. We have been watching for this and saw it reported in the WSJ today. It won’t be law until President Obama signs the bill. His signature is expected in the next few days.

This will help many banks who would face losing deposits as the current deadline loomed. Many of our clients had already allowed CDs to mature and be transferred elsewhere over the last couple of months in order to keep their deposits under the original $100,000 limit.

As long as the extension is signed, the extra 4-years will be very helpful, especially for personal investors utilizing POD (Payable-On-Death) / ITF (In-Trust-For) accounts or Revocable Trusts. Who knows, maybe as the health of the banking sector improves, they’ll make it permanent.

We will send out a post as soon as we know President Obama has signed the extension.

cd :O)

Discover Bank CD rates update: Aug. 18, 2009. The rates are also good for IRAs. They are offering 1Y at 2.00%, 18mo at 2.15% , 2-Year at 2.30%, 3-year at 2.75%, and 5Y at 3.25%.

Here is the link for the regular CDs: Regular CD Pageand
IRA CDs: IRA CD Page

Discover Bank is FDIC insured and their FDIC# is 5649. The rating system we use gives them 5-stars so even if the rate is lower than some other banks, they look like they will be around for a while. According to the data from the FDIC for March 2009, they have lost $69MM. They earned about $600MM for 2008. As of March, they do have about $5BB in capital, so it would seem they will be okay.

IRA CDs are insured up to $250,000 and through 12/31/09 regular CDs are insured up to the same. The rumor mill is whispering that regular CDs will have the 12/31/09 extended, but not made entirely permanent. Of course, that is just a rumor.

Have a great Day
cd :O)