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Investor can delve into meaning of 'insured'

Safety is the highest priority for many investors, especially the elderly. The words "FDIC insured" are used as an advertising magnet. Yet many investors have only the vaguest idea about how deposit insurance and guarantees work. They start asking questions after their bank or broker fails or their investment becomes worthless.

Here's a primer to help you understand what "guaranteed" or "insured" might really mean:

FDIC Insurance: Only banks and savings institutions (many of which now call themselves banks) can offer insurance through the Federal Deposit Insurance Corp. If you buy an FDIC-insured CD through a broker, it should show up on your statement as a CD in a specific bank with a specific maturity date. You can check the FDIC Web site ( to find out whether a bank is insured. The individual insurance limit is $100,000 plus $250,000 for retirement accounts. The brochure "Your Insured Deposit," available on the Web site, tells how to structure deposits to increase insurance, which kicks in when a bank fails. You can also call toll-free 1-877-275-3342 for information.

NCUA Insurance: Credit unions offer insurance similar to FDIC insurance through the National Credit Union Administration, a government agency. Limits are the same as for FDIC insurance. All federally chartered credit unions are insured, but state-chartered credit unions may or may not be.

Securities Investor Protection Corp.: Protects up to $500,000 per customer (including $100,000 in cash) for missing securities if a brokerage firm is liquidated. Does not protect against fraudulent investments. Look for "member SIPC" in ads.

Florida Life and Health Insurance Guaranty Association: Covers up to $100,000 of the present value of an annuity if the insurance company is declared insolvent.

Florida Securities Guaranty Fund: Pays up to $10,000 per investor (capped at $100,000 for all cases involving a single broker) for unpaid court judgments based on certain violations of securities laws. Violator must have been licensed securities dealer or adviser.

Private insurance: Other insurance is as good as the insurance company standing behind it. You can check the financial strength of an insurance company at such Web sites as A.M. Best ( Some bonds are insured against default to improve their ratings. You can check bond ratings at

Government bonds: Some bonds are backed by the full faith and credit of the issuing government body, while others are backed by revenues from specific sources. Some issuers are a lot more creditworthy than others, so check the bond rating.

Question: I retired last year and received a large check with taxes taken out as payment for sick days and vacation days accumulated in previous years. Is this income I have to declare on my return?

Answer: Yes.

Question: I volunteer for a local police department and was told my hours were tax deductible. The city even gave me an official statement showing my hours. Is this true? I have been unable to find any IRS material on this.

Answer: Sorry, but volunteer hours don't count with the IRS. However, you can deduct unreimbursed expenses incurred in volunteer work. For example, if you used your car in volunteer work, you can deduct 14 cents a mile plus parking fees or tolls.

Helen Huntley writes about investing and markets for the Times. If you have a question about investments or personal finance, write or Helen Huntley, Times, P.O. Box 1121, St. Petersburg, FL 33731. Read more questions and answers at