WaMu. Wachovia. IndyMac. We've all seen the headlines about what has happened to these seemingly solid banks. It seems that every day brings more frightening news about the economy and the financial system. Can any of us be blamed for wondering if our money is safe?'
The federal government recently increased the amount of deposit insurance to $250,000 per depositor per bank. So, for example, if you have a checking account at Bank of America and a savings account at Wells Fargo, each is insured for $250,000, or $500,000 total.
Finding federally insured places to put our money here in Oakland is not a problem. In the Laurel, Dimond, and Redwood Heights neighborhoods there are at least eight branches of major banks. But you shouldn't just put your money in an insured account and forget about it. "If you don't have a relationship with your banker, now is the time to start one" says Dale Marie Golden, a Vice President with Alta Alliance Bank in Piedmont. Ms. Golden is the banker for many businesses in the Laurel, Dimond, and other neighborhoods'throughout Oakland, and has over'15 years experience in banking. She says'a good banker will know you and your needs, will make sure that you have the right kinds of accounts, and will be able to explain the turmoil in the markets right now.'
What about your IRA, 401(k), or brokerage accounts? These are not insured by the FDIC. With accounts such as these, there are some things you should keep in mind so that you can sleep at night. Many financial professionals warn that unless you absolutely have to, you should not sell your stocks or bonds in a time like this. Timothy Yee is a financial planner and owner of Cathedral Financial in Oakland. He has been telling his clients not to panic, but to make sure that their investments are aligned with their goals and, more importantly, their values. Timothy strongly recommends that people seek professional advice.
So far, the financial crisis has been limited mostly to the banking sector (and real estate, but that's a different article). In addition, your life insurance policies, estate plan, and other nonbank financial assets are also critical elements of a well-diversified financial plan.
Just as with your banker, you should also be talking regularly with your financial planner, your insurance broker, and your estate planning attorney to make sure that they know what your needs and concerns are. Being involved with these people will help you have the peace of mind you need to get through these turbulent times.'
David Little is an estate planning attorney in Oakland. He can be reached at david\@ddllaw.com, or at 500-4013.'His Web site is'www.ddllaw.com.'
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