Released: September 23, 2008

The Crisis and your pocketbook

Source: Yian Q. Mui & Dina ElBoghdady,, Washington Post (Free Registration)

The government’s complicated financial intervention has left many everyday consumers and investors curious about the impact on their pocketbook. Today, The Post is starting a feature that attempts to answer some timely personal finance questions.

Q. How will the government’s plan affect my money-market fund?

A. Last week, the U.S. Treasury Department promised to insure the value of deposits in money-market mutual funds, much the same way that the Federal Deposit Insurance Corp. protects the first $100,000 in your bank account: Whatever you put in, the government now guarantees you’ll get out.

However, the Treasury has since said that its umbrella is limited to deposits made before the close of business Sept. 19, the day the measure was announced. New accounts or money added to existing accounts will not be covered.

There’s another catch: The guarantee is not automatic. Your money-market fund must pay a fee to participate in the program, and it’s unclear which funds will join. The fee will probably be based on the amount of assets, although details are still being worked out, according to Treasury spokeswoman Jennifer Zuccarelli. The guarantee will last one year. 

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