The good news? Yes, the National Credit Union Share Insurance Fund (NCUSIF) protects your deposits, up to $250,000 per person, per account type, per credit union.

But what happens when you have multiple accounts, a joint account, designate beneficiaries, or want to start a trust? How does deposit insurance work then? Let's go over the different scenarios using the life of our very good friends, the Buendias.

Meet Ursula

Ursula starts her OAS FCU membership with a savings account holding $150,000. We will call this "Account A" Since NCUSIF covers up to $250,000 for individual accounts, she is completely covered and has room to spare.

Enter Jose Arcadio

After a few years Ursula marries her childhood sweetheart Jose Arcadio and they open a joint account with $700,000. Let's call this "Account B". Joint accounts are insured $250,000 per owner, so Account B is fully insured up to $500,000 ($250,000 for each one of them). That leaves $200,000 uninsured.

Later, Ursula adds Jose Arcadio to her original account as co-owner and the account balance totals $450,000. But here's the catch: that coverage is shared across all joint accounts with the same owners at the same credit union. Ursula and Jose Arcadio already own Account B. That means that the full balance of $450,000 on account A is uninsured, and so are $200,000 over the $500,000 coverage on account B.

What could they have done better, insurance-wise? They could have left Ursula's Account A as it was and opened Account C for Jose Arcadio. If they wanted to ensure that they each had rights to each other's money after passing, they accomplish it naming each other beneficiary in their respective accounts. In the end, they do that and establish Account C, leaving each of them sole owners of their own accounts. Smart!

Note: To learn more about account designations, types of ownership and how you can assign beneficiaries to your accounts, we invite you to read our most popular blog post ever:

The Account Holder, The Thief, His Wife and Her Lover.

Aureliano arrives

Two years later, baby Aureliano is born (Arcadio does too, but for purposes of this first scenario let's just go with the one twin!). They add him as a beneficiary on all their accounts, A, B and C. This changes things.

Accounts with named beneficiaries get $250,000 of coverage per beneficiary per owner. So now:

• Ursula's share in each account is insured $250,000 for Jose Arcadio and another $250,0000 for Aureliano (plus, of course, her own insurance as owner).
• Jose Arcadio's share is also insured $250,000 for Aureliano, plus $250,000 for Ursula and Jose Arcadio's own insurance as owner.
• Aureliano is limited to be insured for $500,000 in total, because he is the same beneficiary for the same owners across A ($250,000 from Ursula), B ($250,000 from Ursula -to which he is not entitled- and $250,000 from his dad), and C ($250,000 from Jose Arcadio to which he is not entitled because he is already insured from Account B).

A trust for the twins

As Aureliano and his brother Arcadio grow up, Ursula and Jose Arcadio open a formal irrevocable trust account (Account D) for them with $1,000,000. They are both trustees. Under NCUA rules, irrevocable trust accounts are insured $250,000 per beneficiary per owner, as long as all parties are Credit Union members. Since Aureliano is the sole beneficiary and both parents are owners:

• Ursula's share for Aureliano: $250,000
• Jose Arcadio's share for Aureliano: $250,000
• Ursula's share for Arcadio: $250,000
• Jose Arcadio's share for Arcadio: $250,000

That gives $1,00,000 in coverage, which means that Account D is fully covered.

The twins get their own memberships

To ensure full coverage for their kids' future savings, Ursula and Jose Arcadio open separate memberships in their respective names. This allows them to have their own insured accounts, independent of their parents' coverage. Smart move, and yes, they will do the same for Amaranta when she comes later on!

Pilar joins the credit union

Pilar lands a great job and hears glowing reviews about OAS FCU from Ursula. She joins as family member and opens a joint account with Ursula holding $650,000. Joint account coverage is $250,000 per owner, so this account is insured up to $500,000, leaving $150,000 uninsured.

Pilar's nest egg

Pilar loves her credit union and decides to establish an IRA for her retirement. Over the years she manages to save $300,000 on that account. IRA deposit insurance is $250,000 per owner, so she is covered for that amount, leaving $50,000 without coverage.