Luckily, bank and brokerage failures don’t happen very often. But when they do, they can have a huge destabilizing impact on the wider economy. As we’ve seen with Silicon Valley Bank, not only do bank collapses affect customers and investors, but panic can also spread quickly to other institutions.
The good news is that there are a number of measures in place to protect your savings and investments. Key amongst them are FDIC and SIPC insurance, which cover your money in the event of bank or brokerage failure.
This post originally appeared at The Motley Fool.