Deposit insurance
Deposit insurance guarantees that savers get their money back, up to a limit, if their bank fails. In the US the FDIC insures up to $250,000 per depositor, per bank.
🌍 In the real world
Insurance stops bank runs by removing the reason to run: insured savers are repaid whatever happens. Banks pay premiums into the insurance fund.
Money above the limit is at risk in a failure, which is why large depositors watch a bank's health closely.
🎮 In Journey Shares
Savings at the game's bank are insured up to $25,000. If the bank fails, savings above that can lose part of their value. →
🧭 How to use it
Keep savings under $25,000 if you want them fully safe. Above that, check the bank's capital on its page before parking more there, especially when markets are falling and margin loans are going bad.
🎮 Learn Deposit insurance the fun way
Try it in a live 3D city with play money: trade shares in real public figures, get margin-called, pay your taxes and rob a bot or two. Free, and nothing real is at stake.
❓ Common questions
Has anyone lost FDIC-insured money?
No depositor has lost insured funds since the FDIC began insuring deposits in 1934.
Why is the limit $250,000?
It was raised from $100,000 during the 2008 crisis, and the higher limit was made permanent in 2010.
📜 Where it came from
🔗 Related terms
- Bank run: A bank run happens when many depositors withdraw their money at once because they fear the bank will fail, which can make it fail even if it was sound.
- Moral hazard: Moral hazard is the tendency to take more risk when someone else bears the cost if things go wrong, such as a bank expecting a bailout or a driver who is fully insured.
- Fractional reserve banking: Fractional reserve banking is the system in which banks keep only part of their deposits as cash reserves and lend out the rest, which creates new money in the economy.
- Bailout: A bailout is when a government or central bank gives money to a failing company or bank to keep it from collapsing, usually because its failure would hurt the wider economy.
Categories: Banking and credit
Practise with $10,000 in play money
Free. No real money involved.