Sarah Edwards | May 05, 2023
Summary: News of the Silicon Valley Bank collapse in March 2023 shook the economy and made many people concerned about the security of their bank-held finances. SoloSuit explains what you need to know about the situation.
Silicon Valley Bank is known for servicing many tech companies. It specializes in helping tech startups and private equity firms with loans, banking services, and asset management. Individual consumers can also bank with Silicon Valley, and many tech industry employees and California residents have chosen to do so.
You might be unfamiliar with the bank if you don’t work in tech or don’t live in California. Silicon Valley Bank was the nation’s 16th-largest financial institution before its collapse on March 10, 2023. According to a Federal Reserve Board finding, the failure occurred due to mismanagement of liquidity and interest risks, along with weakened regulatory action by the Federal Reserve itself.
While Silicon Valley Bank is up and running again after being purchased by First Citizens Bank, you might wonder whether its failure could cause issues for customers of other banks. The good news is that you probably don’t need to worry about the security of your money if it’s in an FDIC-insured bank. Let’s review why.
Is a debt collector chasing you for a debt you owe? Consider debt settlement as your way out.
FDIC insurance is enough for the average consumer who has a checking or savings account with an FDIC-insured bank. This insurance protects up to $250,000 of an individual’s depository accounts in a single financial institution. Depository accounts include the following:
However, FDIC insurance will not protect investment accounts like mutual funds, annuities, stocks, bonds, or life insurance.
Each depository account is subject to the same $250,000 limit. Suppose that you have $250,000 in a checking account, $250,000 in savings, and $250,000 in CDs at the same bank, and the bank suddenly fails. The FDIC will refund you a maximum of $250,000. You could lose the remaining $500,000.
Not sure how debt settlement works? Watch the following video to learn all about how to settle your debts for good:
The federal government has many regulations to ensure banks protect your money properly. Government officials know that bank failures can have an adverse economic and psychological impact on consumers and businesses, so it's in their best interests to monitor the banking system for problems.
Despite the federal government’s efforts, an average of 3.6 banks failed annually between 2015 and 2022. However, that’s a far cry from the height of bank failures during the Great Depression, when over 9,000 banks failed nationwide.
The FDIC doesn’t insure investment accounts. If a lot of your money is tied up in stocks and bonds, you’ll want to pay close attention to the stability of your banking institution. People with 401(k) retirement accounts and similar investments should be careful to safeguard their funds in reputable institutions, not fly-by-night companies they’re unfamiliar with.
If your depository accounts exceed $250,000 in a single bank, consider opening accounts at different banks to reduce the risk of losing money.
Let’s consider an example.
Example: Henry has $750,000 in a single checking account with Purple Bank. While Purple Bank is FDIC-insured, Henry knows he could lose $500,000 if the bank fails. He sees no signs that Purple Bank is failing but is very risk-averse. His grandfather lost his life savings during a Great Depression-era bank run, and he knows how much his family suffered during that period. Henry opens two new checking accounts at Blue Bank and Red Bank and deposits $250,000 in each. Now, all of Henry’s money is FDIC-insured. Even if all three banks fail, Henry will still recover his cash.
If you ever experience a bank failure that impacts your depository account, know that the FDIC will refund you typically within the next few days. It will either open a new account in a different bank and deposit your money or issue you a check.
While all Silicon Valley Bank account holders were made whole after the bank collapse, that isn’t always the case. Silicon Valley Bank found a buyer with First Citizens, so no account holders lost their money. However, if you have depository accounts worth more than $250,000, it may be worth spreading your money across several banks to mitigate your risks.
Is your bank suing you for unpaid debt? Settle the claim with the help of SoloSettle, powered by SoloSuit.
SoloSuit makes it easy to fight debt collectors.
You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.
SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.
>>Read the NPR story on SoloSuit. (We can help you in all 50 states.)
Here's a list of guides for other states.
Being sued by a different debt collector? Were making guides on how to beat each one.
You can ask your questions on the SoloSuit forum and the community will help you out. Whether you need help now are are just look for support, we're here for you.
Is your credit card company suing you? Learn how you can beat each one.
Going to Court for Credit Card Debt — Key Tips
How to Negotiate Credit Card Debts
How to Settle a Credit Card Debt Lawsuit — Ultimate Guide
Need more info on statutes of limitations? Read our 50-state guide.
Why do debt collectors block their phone numbers?
How long do debt collectors take to respond to debt validation letters?
What are the biggest debt collector companies in the US?
Is Zombie Debt Still a Problem in 2019?
If a car is repossessed, do I still owe the debt?
Is Portfolio Recovery Associates Legit?
Is There a Judgment Against Me Without my Knowledge?
Should I File Bankruptcy Before or After a Judgment?
What is a default judgment?— What do I do?
Summoned to Court for Medical Bills — What Do I Do?
What Happens If Someone Sues You and You Have No Money?
What Happens If You Never Answer Debt Collectors?
What Happens When a Debt Is Sold to a Collection Agency
What is a Stipulated Judgment?
What is the Deadline for a Defendants Answer to Avoid a Default Judgment?
Can a Judgement Creditor Take my Car?
Can I Settle a Debt After Being Served?
Can You Appeal a Default Judgement?
Do I Need a Debt Collection Defense Attorney?
Do I Need a Payday Loans Lawyer?
Do student loans go away after 7 years? — Student Loan Debt Guide
Am I Responsible for My Spouses Medical Debt?
Should I Marry Someone With Debt?
Can a Debt Collector Leave a Voicemail?
How Does Debt Assignment Work?
What Happens If a Defendant Does Not Pay a Judgment?
How Does Debt Assignment Work?
Can You Serve Someone with a Collections Lawsuit at Their Work?
How Many Times Can a Judgment be Renewed in Oklahoma?
Does Debt Consolidation Have Risks?
What Happens If You Avoid Getting Served Court Papers?
Does Student Debt Die With You?
Can Debt Collectors Call You at Work in Texas?
How Much Do You Have to Be in Debt to File for Chapter 7?
What Is the Statute of Limitations on Debt in Washington?
How Long Does a Judgment Last?
Can Private Disability Payments Be Garnished?
Can Debt Collectors Call From Local Numbers?
Does the Fair Credit Reporting Act Work in Florida?
The Truth: Should You Never Pay a Debt Collection Agency?
Should You Communicate with a Debt Collector in Writing or by Telephone?
What Happens After a Motion for Default Is Filed?
Can a Process Server Leave a Summons Taped to My Door?
Need help managing your finances? Check out these resources.
How to Make a Debt Validation Letter - The Ultimate Guide
How to Make a Motion to Compel Arbitration Without an Attorney
How to Stop Wage Garnishment — Everything You Need to Know
How to File an FDCPA Complaint Against Your Debt Collector (Ultimate Guide)
Defending Yourself in Court Against a Debt Collector
Tips on you can to file an FDCPA lawsuit against a debt collection agency
Advice on how to answer a summons for debt collection.
Effective strategies for how to get back on track after a debt lawsuit
New Hampshire Statute of Limitations on Debt
Sample Cease and Desist Letter Against Debt Collectors
The Ultimate Guide to Responding to a Debt Collection Lawsuit in Utah
West Virginia Statute of Limitations on Debt
What debt collectors cannot do — FDCPA explained
Defending Yourself in Court Against Debt Collector
Arkansas Statute of Limitations on Debt
Youre Drowning in Debt — Heres How to Swim
Help! Im Being Sued by My Debt Collector
How to Make a Motion to Vacate Judgment
How to Answer Summons for Debt Collection in Vermont
North Dakota Statute of Limitations on Debt
ClearPoint Debt Management Review
Indiana Statute of Limitations on Debt
Oregon Eviction Laws - What They Say
CuraDebt Debt Settlement Review
How to Write a Re-Aging Debt Letter
How to Appear in Court by Phone
How to Use the Doctrine of Unclean Hands
Debt Consolidation in Eugene, Oregon
Summoned to Court for Medical Bills? What to Do Next
How to Make a Debt Settlement Agreement
Received a 3-Day Eviction Notice? Heres What to Do
How to Answer a Lawsuit for Debt Collection
Tips for Leaving the Country With Unpaid Credit Card Debt
Kansas Statute of Limitations on Debt Collection
How to File in Small Claims Court in Iowa
How to File a Civil Answer in Kings County Supreme Court
Roseland Associates Debt Consolidation Review
Do Debt Collectors Ever Give Up?
Can They Garnish Your Wages for Credit Card Debt?
How Often Do Credit Card Companies Sue for Non-Payment?
How Long Does a Judgement Last?
How Long Before a Creditor Can Garnish Wages?
How to Beat a Bill Collector in Court
Out Debt Validation Letter is the best way to respond to a collection letter. Many debt collectors will simply give up after receiving it.
"Finding yourself on the wrong side of the law unexpectedly is kinda scary. I started researching on YouTube and found SoloSuit's channel. The videos were so helpful, easy to understand and encouraging. When I reached out to SoloSuit they were on it. Very professional, impeccably prompt. Thanks for the service!" - Heather