Why is storing money in a bank considered safer than storing it in other investment vehicles?
-banks offers a wider array of financial planning services
-bank accounts are often opened with savings accounts
-bank deposits are insured by the government
-banks typically know each of their customers
-personally and can identify fraudulent activity more easily
Overall, storing money in a bank is considered safer because it is FDIC (Federal Deposit Insurance Corporation) insured up to $250,000 per depositor per account ownership type. This means that if the bank were to fail, the government guarantees the depositor their money back up to the insured limit. Other investment vehicles such as stocks, mutual funds, or real estate do not have this level of protection. Additionally, banks have a well-established system of regulatory oversight and internal controls to prevent fraud and protect customer information.