FDIC Deposit Spreading

A discussion about how wealthy individuals and businesses manage their bank deposits to stay within FDIC insurance limits, particularly relevant during the Silicon Valley Bank crisis.

FDIC Protection Strategies

• Standard FDIC insurance limit is $250,000 per account
• Wealthy individuals often spread money across multiple banks to stay protected
• Common practice among sophisticated investors and business people

Notable Examples

• Giannis Antetokounmpo (NBA player)

  • Has 50 different bank accounts
  • Each account contains up to $250,000
  • Strategy developed after experiencing Greek banking crisis

• Jared Kushner

  • Released financial documents showed dozens of bank accounts
  • Each account maintained at $250,000 level
  • Systematic approach to FDIC protection

Banking Services for Wealthy Clients

• JPMorgan offers auto-sweep services
  • Automatically distributes large deposits across multiple accounts
  • Designed for clients with $20M+
  • Handles the complexity of managing multiple accounts

Common Misconceptions

• Many people unaware of FDIC limits until crisis situations
• Assumption that keeping large amounts in single account is "safe"
• People often think splitting across multiple accounts is too inconvenient
• Many learn about FDIC limits only during banking crises

Modern Banking Reality

• Digital banking makes managing multiple accounts easier
• Bank runs happen faster now due to:
  • Online banking accessibility
  • Social media spreading information quickly
  • Ability to move money instantly
• Traditional physical bank runs less common due to digital transfers