Question

Why is storing money in a bank considered safer than storing it in other investment vehicles?

A. Banks offer a wider array of financial planning services.

B. Bank accounts are often opened with savings accounts.

C. Bank deposits are insured by the government.

D. Banks typically know each of their customers.

Answer 1

[AI-generated answer — Bot GPT 3.5]

C. Bank deposits are insured by the government.

This is the main reason why storing money in a bank is considered safer than storing it in other investment vehicles. The Federal Deposit Insurance Corporation (FDIC) in the United States insures deposits in banks up to a certain limit, typically $250,000 per depositor, per bank. This means that even if the bank fails, the deposited money is protected by the government insurance. This level of protection makes storing money in a bank a less risky option for individuals compared to other investment options.