Why Would I Use CDARS?
FDIC insurance only covers your deposits up to certain limits. There are a variety of ways you can increase your coverage - titling accounts properly, spreading your money among various banks, and so on. If you do not want to do all the legwork yourself (or if you have a lot of money to spread around), you can use CDARS.
Your bank will spread your money among other member banks, ensuring that your principal and interest never get above FDIC insurance limits. You don’t have to open accounts at different banks or read statements from each of those banks - you just use the CDARS program.
How do I Use CDARS?
To use CDARS, you must use a bank that participates in the CDARS program. CDARS is run by Promontory Interfinancial Network, LLC, and banks must join the program to participate.
If you have money that you want to put in CDs, you hand it over to the participating bank. After that, they do the legwork of spreading it out among other FDIC insured banks for you. The process is similar to using brokered CDs.
To find a bank in your area that uses CDARS, visit their website CDARS.com.
