As I wrote in an earlier post, the FDIC is worried about people pulling money out of bank because they seem to have the need to remind us how safe our money is with banks. The key problem with the FDIC’s message is that they seem to forget or willfully ignore the effect of inflation on the currency and subsequent “value” of coverage. To that end, I have created the table below to show the FDIC how they need to adjust their coverage for inflation since no one there seems to do anything unless a crisis pops up.

I assume a 3% rate of inflation and use 10 year cadence adjustment. The column on the rate is the actual calculation and the column on the left is a suggested rounded number. Keep in mind that as of the date on this post the coverage is $250,000 and it may stay there without people prodding their representatives and government officials to raise this amount.

YearFDIC Insurance CoverageActual TVM (3% inflation rate)
1933$2,500
1934$5,000
1950$10,000
1966$15,000
1969$20,000
1974$40,000
1980$100,000
2008$250,000
2020$350,000$335,979.09
2030$475,000$470,370.73
2040$650,000$638,360.28
2050$875,000$873,545.65
2060$1,200,000$1,175,926.83