Explore Other Account Options Like CDARS
If you have significant liquidity and don’t want to spend all of your time maintaining a large number of bank accounts (what a nice, first world problem!), a CDARS account would be a great way to go. CDARS is a service that places your funds at a variety of different institutions for you in order to take advantage of the market’s best rates and keep your funds always under the FDIC insured limits. You’ll receive consolidated interest payments from the single institution that holds your CDARS account, so it automatically simplifies this investment strategy.
Not Every Failure Means a Systemic Crisis
In the wake of the Cyprus banking default, many news outlets carried stories that magnified the threat of banking failures and depositor losses in the United States. Despite the apocalyptic forewarnings, consumers have seen no real reason for immediate anxiety over the welfare of their deposits. Despite potential long-term regulatory implications for financial institutions in the Eurozone, there is and was never an imminent threat of a domino effect across U.S. banks and credit unions. Just the same, most banking failures that start inside the United States remain very local to the affected institution and rarely have string-like implications.
Greedy Bankers Are Not Always to Blame
While the media tends to fire up the barbecue pit and look for a banker to roast after a failure (the bigger the bank, the hotter the fire), bank leadership and equity owners are not necessarily the culprits. Instead, the causes of a bank’s failure are usually complicated and not readily identifiable because of bigger market factors like shifts in housing prices or changing industry regulations. The 2008 banking collapse was a combination of regulatory error and willful ignorance at the tops of big banks.