Insuring Individual Retirement Accounts (IRAs)
A self-directed retirement account is a retirement account for which the owner, not a plan administrator, has the right to direct how the funds are invested, including the ability to direct that the funds be deposited at a specific FDIC-insured bank.
Types of self-directed retirement accounts include traditional and ROTH Individual Retirement Accounts (IRAs), Simplified Employee Pension accounts, “Section 457” deferred compensation plan accounts, self-directed Keogh plan accounts, and self-directed defined contribution plan accounts.
Note: All “Section 457” deferred compensation plan accounts regardless of whether they are self-directed, are included in this category of coverage.
All self-directed retirement funds owned by the same person in the same FDIC-insured bank are added together and the total is insured up to $250,000.
Naming beneficiaries to a self-directed retirement account does not increase insurance coverage.
A Roth IRA is treated the same as a traditional IRA for deposit insurance purposes. So, if a depositor has both a Roth IRA and a traditional IRA at the same insured bank, the funds in both accounts are added together and insured up to $250,000.
Source: Your Insured Deposits; FDIC’s Guide to Deposit Insurance Coverage, April 2006
