Seven Places Not to Keep Your Money After 60, and How to Check Each One

If you're working out where to keep money after retirement, start with the account that holds the most and ask who is actually holding it. In 2024, about 85,000 people would have gotten that answer wrong. Their app said FDIC insured, the bank behind it was real, and they still couldn't reach their money. One woman had $15,000 in her account and was offered 75 cents for the entire balance. Someone else had saved $21,000 and got $17 back. No bank failed.

The app that says FDIC insured

The FDIC insures banks. It doesn't insure the companies that sit in front of banks. When an app takes your deposit, that app usually isn't a bank at all. It routes your money to a real, insured partner bank, and then the app or a middleman working for it keeps the only ledger showing which dollars in that big pooled account belong to you.

FDIC insurance pays out when a chartered bank fails, and nothing else sets it off. Here no bank failed, so the insurance never turned on. Their money depended on the records of a company that went bankrupt, and those records didn't add up.

The app was called Yotta and the middleman was Synapse. In October 2023, months before the collapse, Yotta moved its customers' accounts off the partner bank and onto a Synapse subsidiary with no FDIC protection at all. When everything fell apart, the money wasn't sitting where the insurance was. California fined Yotta $1 million in May 2026, finding the company had serious concerns about Synapse when it moved the money.

To check your own app, find the name of the bank behind it, usually in the fine print after "banking services provided by," and look that bank up with BankFind at FDIC.gov. If the app won't give you a bank name, you aren't looking at a bank account. Even a real bank name can't guarantee your money never gets moved, which is exactly what happened with Yotta.

Money above the limit at a real bank

The second place is the bank itself. You know $250,000 is FDIC coverage. The part that gets left off is what it attaches to: $250,000 per depositor, per bank, per ownership category. An ownership category is how the account is held, meaning whose name is on it, and each one gets its own $250,000. Single accounts, joint accounts, retirement accounts, and certain trust accounts each count separately.

Take a married couple at one bank. His single account is covered to $250,000, and hers is covered to another $250,000. Their joint account covers $250,000 per co-owner, which adds $500,000. That's $1 million of insured money at the same bank, and the only thing that changed is whose name is on what. Nothing requires the bank to flag it if you go over.

About 43% of all the money in American commercial banks sits above the insured limits right now, and in one of this year's four bank failures, the uninsured money became a claim on the receivership. The FDIC runs a free calculator called EDIE at edie.fdic.gov. Enter your accounts and how they're titled, and in a few minutes it gives you your covered amount. If you come up short, the fix is retitling. It's a simple form, sometimes a trip to the branch, and you don't sell anything or move a dollar out of the bank.

Idle cash and long CDs

The third place is a checking or savings account holding years of spending. This one has nothing to do with safety, since the money is insured. The problem is what it costs you to leave it there. As of this summer, the national average savings account pays 0.38% and interest checking pays 0.07%. Federally insured savings accounts pay north of 4% with the same insurance and the same access, mostly at online banks with no branches.

On $100,000, the average savings account pays about $380 a year. At 4.15%, the same $100,000 pays about $4,150. That gap is around $3,770 a year, and no statement has a line for it. Pull up the account and find the APY. The balance isn't the number that matters.

None of this means leaving cash for the market. Cash is allowed to be cash, and if you set aside a few years of spending on purpose, keep it. It should still earn what cash earns today.

The fourth place is a long CD. You'd assume locking money up longer pays more, yet the FDIC's own national rate table shows a 12-month CD averaging 1.68% and a 60-month CD averaging 1.36%. A bank setting a five-year rate is pricing what it expects to pay for your money across all five years, and when it expects rates to fall, it won't promise today's rate that far out. Breaking one early costs somewhere between 90 and 365 days of interest, depending on the bank.

Check the paperwork for two words. A CD bought through a brokerage account is a brokered CD, which has no early withdrawal penalty. The way out is selling it on the open market, and if rates have risen since you bought it, it sells for less than you paid. The other word is callable. A callable CD lets the bank end the deal early, which it will do when rates fall, leaving you shopping in a market where everything pays less than what you just had.

Cash in a safe deposit box or home safe

The fifth place is cash in a home safe or a bank safe deposit box. A box is storage space, and FDIC insurance covers deposit accounts only. Most homeowner's policies cap cash around $1,000 to $1,500, and plenty exclude cash in a safe deposit box entirely. If there's real money in there, ask your insurance agent about a scheduled property rider, or move the cash into an FDIC-insured account.

Old 401(k)s and rollovers sitting in cash

The sixth place is an old 401(k) at a company you left. There are 31.9 million forgotten 401(k) accounts holding $2.13 trillion, and the average one holds $66,691 at an employer the owner left about 15 years ago.

Leaving it alone isn't neutral. Under current rules, if your old balance is under $7,000, your former employer can force it out of the plan without asking. It goes into a safe harbor IRA that by default gets parked in something cash-like, so the money stops growing the day it moves. You get one notice, and after that nothing tells you a thing. Bigger balances just sit in whatever you picked years ago with no one watching. The Department of Labor built a free database at lostandfound.dol.gov that searches for retirement accounts left behind in your name. You'll need a login.gov account to sign in.

The seventh place is the sneakiest because you did the right thing and rolled the old 401(k) into an IRA. The money lands in the IRA as cash and stays there until you log in and pick something.

Vanguard looked at this. A year after the rollover, 28% of those IRAs were still entirely in cash, and those balances tend to stay in cash for at least seven years. The balance looks right, so log in and read the holdings line. If the money sits in a money market, a settlement fund, or cash reserves, it's parked.

If you're already living on this money, an account in the wrong place costs you this year. If you're 10 to 15 years out, it costs more, because a parked account spends all that time not growing. Most of these accounts weren't a bad decision on the day you set them up. They just never got looked at again.