Bank accounts held in federally insured institutions are insured by the FDIC up to certain limits. But what about the bonds, stocks and money market funds that you have in a brokerage account?
SIPC & FDIC Are Not the Same Protection
These assets are not covered by the FDIC, but they probably are insured by the Securities Investment Protection Corporation (SIPC). But probably doesn’t mean always. So check to make sure your brokerage firm participates and check out this SIPC brochure for more information about limits and coverage. Unlike the FDIC coverage, SIPC is not backed by the government.
And to be clear, SIPC doesn’t protect you against investment losses so check your investment portfolio regularly & get the advice you need to manage your financial risks and meet your goals.