We recently opened a Joint Personal Savings account with American Express or should I say American Express Bank, FSB who are proud FDIC members. What does FDIC stand for? FDIC is an abbreviation for Federal Deposit Insurance Corporation which is an independently operated agency of the United States government which protects member account holders against the loss of deposits if an FDIC-insured bank or savings member fails or becomes insolvent. For single account holders, this means $250,000 worth of insurance! FDIC backed institutions have not lost one penny of money for their account holders since the creation of the FDIC in 1933!
We opened this account because we had circa $25000 in cash that was earning the anemically low interest rate of 0.05% in our home town credit union. To give you perspective on how egregiously low that rate is, our 25K would earn a little over a SINGLE USD per month! Contrast that with 0.90 per cent rate offered by FSB which is closer to $20 per month earned in interest.
The pic you see below is a joint account signature form. The FDIC requires the signature of both the primary and joint account holders which would be me and my wife in this case. Here comes the good news. Filling out and submitting this form to American Express Bank gives us a combined half a million dollars in coverage. Do any of you see why this WON’T put credit unions out of business around the United States? AmEx charges no fees for opening this account online and account holders can have up to six withdrawals per month with unlimited deposits, of course. It is in no way linked with credit card account. We got completely setup online in less than 15 minutes without having to engage a customer service rep in a telephone converstation. They will send two test deposts of less than one dollar to authenticate any funding accounts, after which you can transfer funds back and forth freely and easily. So, why won’t credit become a dying breed? Maybe their signature loans and low auto finance interest rates, but I know that ours just lost 25K in deposits.