There are no deposit limits with CDARS and it is a homesteader’s easy way to stash hard cold cash in a loophole as a friend to your money.
You may find CDARS to be a friend to your money when you become a high net worth homesteader and/or blogger.
CDARS is the best place to stash large sums of cash without FDIC insurance limits.
The Certificate of Deposit Account Registry Service (CDARS) is a U.S. for-profit service that breaks up large deposits from individuals, companies, nonprofits, public funds, etc.
Then, places them across a network of more than 3,000 banks, and savings associations around the United States.
This allows depositors to deal with a single bank that participates in CDARS.
Meanwhile, avoid having funds above the Federal Deposit Insurance Corporation (FDIC) deposit insurance limits in any one bank.
The service can place multiple millions in deposits per customer, and make all of it qualify for FDIC insurance coverage.
A customer can achieve a similar result, as far as FDIC insurance is concerned, by going to a traditional deposit broker.
Or, opening accounts directly at multiple banks.
Although depending on the amount, this could require a lot more paperwork.
With the CDARS service, the customer’s local bank sets the interest rate that will be paid on the entire deposit amount.
Also, the customer gets one consolidated statement from that bank.
The service is used by community and regional banks to obtain deposits they would otherwise be unable to get.
All FDIC insured banks, like the banks that receive deposits through CDARS, pay premiums into the FDIC insurance fund based on their deposits and risk levels.
The FDIC has confirmed that deposits placed through a deposit placement service such as CDARS are eligible for “pass-through” FDIC insurance.
The FDIC has not endorsed any particular method of maximizing FDIC insurance coverage.
However, they state that depositors should “protect all of (their) deposits with FDIC insurance.”