How your kid's money is protected.
"Insured" is doing a lot of work on a marketing page. Here's what each regime in the Trailmarker index actually covers — and, more importantly, what it doesn't.
FDIC direct
The bank holding the money is itself a member of the Federal Deposit Insurance Corporation, a US government agency. If the bank fails, deposits are insured up to $250,000 per depositor.
In our index: Chase First Banking, Capital One MONEY & 360, Axos, Varo, SoFi.
FDIC pass-through
The app you use is a fintech, not a bank: it holds your money at a partner bank, and FDIC insurance "passes through" to you if that partner bank fails. Every fiche in the index names the partner bank.
Important nuance. Pass-through protects you from the bank failing — if the fintech middleman collapses, getting your money back can take time. The 2024 Synapse collapse left customers locked out for months.
In our index: Greenlight, Step, Acorns Early, Current, Chime, Cash App, Till, Revolut.
SIPC (brokerage accounts)
Fidelity Youth is a brokerage account, not a bank account. SIPC protects up to $500,000 in securities and cash if the brokerage firm fails.
It does not protect against investments losing value — that's market risk, and it's the point of investing. Cash swept into a money market fund is not FDIC insured either.
NCUA (credit unions)
Credit unions like Alliant are insured by the National Credit Union Administration, a US government agency, up to $250,000 per depositor. Same federal protection as FDIC, different insurer — because credit unions are member-owned cooperatives rather than banks.
The four regimes, side by side
| Regime | Who insures | Amount | Protects against | Does NOT protect against |
|---|---|---|---|---|
| FDIC direct | Federal Deposit Insurance Corporation (US government) | $250,000 per depositor | Bank failure | Fintech middleman failure, investment losses |
| FDIC pass-through | FDIC via the fintech's partner bank | $250,000 per depositor | Partner-bank failure | Fintech collapse (funds may be locked), investment losses |
| SIPC | Securities Investor Protection Corporation | $500,000 (incl. $250k cash) | Brokerage-firm failure | Market losses, money-market fund losses |
| NCUA | National Credit Union Administration (US government) | $250,000 per depositor | Credit-union failure | Fintech middleman failure, investment losses |
Every card page in our index states its exact protection regime and partner bank — because "insured" should never be a vague word.