[Lisa B]

It's a money market account that is not FDIC insured. I put funds in Vanguard because it was getting much better interest than a bank, now I don't know if it's a good idea.

[Rick B]

Yes, a money market account is very safe, but does not pay well. I hope she has a diversified protfolio and that it is not all in the money market - it would lose a lot to inflation.

[techbankguy]

No mutual funds are technical "FDIC" insured.

They are SIPC insured. Vanguard is SIPC insured and a very stable company. I personally wouldn't worry (I actually have funds in their tax exempt accounts for the same purpose.

From the FDIC Website:

Securities you own, including mutual funds, that are held for your account by a broker, or a bank's brokerage subsidiary are not insured against loss in value. The value of your investments can go up or down depending on the demand for them in the market. The Securities Investors Protection Corporation (SIPC), a non government entity, replaces missing stocks and other securities in customer accounts held by its members up to $500,000, including up to $100,000 in cash, if a member brokerage or bank brokerage subsidiary fails. For more information contact:

Securities Investor Protection Corporation
805 15th Street, NW Room 800
Washington, DC 20005-2215
202-371-8300
www.SIPC.org

Hope that helps.