As the crisis on Wall Street continues – even as news crosses that the Fed will come to the rescue of AIG - regular folks around the country are wondering how all of this going to affect their retirements, investments and bank accounts. On Tuesday’s On the Money Special Report, Carmen reiterated the most important thing that everyone should know with regard to what is happening in our financial market: Most of your money is insured. As long as it is in places that are protect, you will be fine.

The FDIC insures bank deposits of up to $100,000 per deposit per bank and IRAs up to $250,000. If your bank is FDIC insured, and most are, you do not have to worry about what will happen to your money if your bank fails, as long as it’s within the $100,000 threshold.

Employee pensions and 401(k) plans are also covered by the Employee Benefit Protection Act. However, the performance of individual stocks is not protected by anything. Bottom line: if you have a checking account at a struggling bank like WaMu, you’re money is safe. If you have stock in WaMu, you might not be so lucky.

But with half of Americans living paycheck to paycheck, getting your money out quickly in the event of a bank failure is almost as important as getting it out at all. While the protocol calls for funds to be returned within 24 hours, there have been reports in past instances of bank customers having to wait days or weeks to see their money. Sandra Thompson, the director of Consumer Protection at the FDIC, explained that worried consumers can go to myfdicinsurance.gov or call the FDIC’s toll-free number at 877-ASK-FDIC to find out more information about how fast it will take the FDIC to pay back funds in the event of a bank failure. Thompson reminded: In the 75 year history of the FDIC, not a single insured depositor has ever lost a penny.

One of the things not typically insured, however, is life insurance. This might sound frightening in the face of the reports that AIG, the country’s largest insurer, is teetering on the brink of bankruptcy (although the late news is that the company will not fail). It reminds us how important it is to follow through with our insurance companies to find out if they guarantee their own products, Carmen said. Remember, your money is not just your cash on hand – it’s a lot more, so make sure it’s all accounted for. Head to the web site of the National Conference of Insurance Guaranty Funds for information on what kinds of insurance have their own insurance.

Perhaps the best thing you can do right now, according to Carmen, is nothing. Don’t panic but use this financial shockwave to do your own research, know how your banks, brokers and insurers work and what’s covered so in case things do get worse, you will know how to proceed to keep your money safe.

Know what you’ve got, where you’ve got it, and you’ll get through this OK.

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