Where Your Money Lives

The story: Is my money in a bank?

Jade stands at a bank counter holding a phone with a money app open, while a banker points to a sign about deposit insurance.

1. Narrator: Jade keeps every paycheck in a money app. It’s easy to spend from, and it pays nothing on the balance.
2. Jade: A friend said app money might not be insured. Is that true?
3. Banker: Some apps aren’t banks. Your money may sit at a partner bank, or it may not be covered at all. The app’s terms say which.
4. Narrator: Most banks have FDIC insurance, and most credit unions have NCUA insurance. Both protect deposits if the bank or credit union fails, up to a limit.
5. Jade: Got it. Checking for spending, a savings account that pays interest for my emergency fund, and both insured.

What you’ll learn

1. Checking, savings, money market, CD

   Checking is for everyday spending: a debit card, bill pay and deposits. Savings is for keeping, and it pays interest. A money market account is savings with a few checks. A CD (certificate of deposit) locks money for a set time at a set rate, with a penalty to take it out early.

2. Banks, credit unions and online banks

   Banks are businesses run for profit. Credit unions are owned by their members and often have lower fees. Online banks have no branches and often pay more on savings. Many people keep checking near where they live and savings wherever it earns more.

3. Deposit insurance

   FDIC insurance protects money at insured banks, up to $250,000 per depositor, per bank, for each kind of ownership. NCUA insurance protects credit union deposits the same way. Some money apps aren’t banks: your money may sit at a partner bank or have no deposit insurance, so the app’s terms matter.

4. APY: what savings earns

   Interest on savings is shown as APY, the annual percentage yield. It’s a year of growth, counting interest on interest. A higher APY earns more on the same balance, but fees can wipe it out, so people compare both.

   Example: $2,000 at a 4% APY (example) earns about $80 in a year. At 0.01%, it earns 20 cents.

Key words

checking

an account for everyday spending and bills

high-yield savings

a savings account that pays a higher APY

APY

what savings earns in a year, counting interest on interest

Also called: annual percentage yield

credit union

a member-owned, not-for-profit place to bank; most are insured by the NCUA

Common questions

How do I know if my money app is covered?

Look in the app’s terms or help pages for FDIC or NCUA insurance and the name of the partner bank. You can look up an insured bank with the FDIC’s BankFind tool.

Remember this

Checking for spending, savings for keeping, and insured either way.

Try it: Check where your money lives

1. List each place you keep money: a bank, a credit union or an app.
2. Check each one’s fees, APY and deposit insurance.
3. Note which one fits spending and which fits saving.

List each place’s real fees and APY side by side on paper.

Live facts

Numbers that change over time, with when they were last checked and where they come from.

• FDIC insurance

  $250,000per depositor, per insured bank, per ownership category

  How much of your money at an FDIC-insured bank is protected if the bank fails

  As of February 8, 2026

  Source: FDIC.gov(opens in a new tab)

• NCUA share insurance for credit unions

  Source: NCUA.gov(opens in a new tab)