> “There was no warning that I would not be able to access my accounts for five days,” she added. “If I had to use that money, it was completely inaccessible.”
A good reminder that your emergency fund should be held in cash at a bank, not in shares a brokerage. Not that a glitch like this couldn’t block access to your bank account too, but rather that the process of liquidating and transferring securities is much slower than ACH or Zelle.
Something like Fidelity's Cash Management Account (has a debit card, automatically liquidates money market funds to cover spending) works fine as an emergency fund. But you need your emergency fund in two separate accounts at two different financial institutions to be safe from shenanigans like this.
This is not merely a theoretical risk. Patelco (a Bay Area credit union with half a million members) got hit with ransomware back in 2024 that disrupted banking services for two weeks.
I find a T-bill ladder works best for me. I keep half my emergency savings in 4 week bills. Given that my emergency savings is intended to sustain me for months, I can easily access the back half of my savings over the course of 4 weeks as each bill expires, returning another 12.5% of my emergency savings to me.
And in a worst case scenario where I can’t access the front half of my savings due to a bank run or other failure, I am only a week or so away from getting access to some part of my savings.
> the process of liquidating and transferring securities is much slower than ACH or Zelle.
That doesn't seem relevant here. The account disappeared due to a data maintenance error; it wasn't extracted via a legitimate transfer to another account, they literally forgot about it.
Friendly reminder that banks are not a reliable place to keep emergency funds, they don't really have a vault full of everyone's cash always available.
> they don't really have a vault full of everyone's cash always available.
When the Silicon Valley Bank collapsed, funds were only inaccessible for 72 hours, and no depositors lost any money [0]. Which is still not ideal, but most people will never experience a bank collapse, and there are plenty of banking activities that will take longer than 72 hours to process in regular circumstances anyways.
A glitch prevented her account from being displayed for a few days, then was resolved. Your money, when covered via FDIC/SIPC and federal regulations, doesn’t just “disappear”.
I don't know that I'd call it clickbait, that's underselling it a bit. If you can call your bank and they flat out pretend you don't even exist, that you are not a customer, or whatever -- that's more than just a display error. Her accounts weren't even visible to bank staff. That's a pretty significant error.
Yeah saving statements is important but banks make it so hard to automate. 2FA for login, and statements have to be navigated to, sometimes time range set.
My bank just sends a note that a statement is available, rather than an actual statement.
> Yeah saving statements is important but banks make it so hard to automate. 2FA for login, and statements have to be navigated to, sometimes time range set.
Which is why all of my accounts mail a physical statement each month. Yes, just about every time I log on they beg me to switch to electronic only, I say no and move along.
> My bank just sends a note that a statement is available, rather than an actual statement.
Yep. If they had implemented it just like the mail, they'd just email me the PDF (encrypted if necessary). But they don't, so I don't ever agree to "go electronic statements".
Paper statements are now opt-in most places, so most people won’t have local copies of the records anymore. It’s extremely important, because there is no duty for a company to provide historic data. None of my banks provide detailed data back more than a couple of years.
That is a good point and at the very least it’s a good idea to download electronic statements, maybe with a script to retain the most recent n statements
FDIC usually doesn't protect against attacks on individual depositors. Fraud, scams, and theft for instance arent covered. If your bank just steals it FDIC usually won't be for that.
Deposit insurance coverage protects depositors against the failure of an insured bank; it does not protect against losses due to theft or fraud, which are addressed by other laws
A good reminder that your emergency fund should be held in cash at a bank, not in shares a brokerage. Not that a glitch like this couldn’t block access to your bank account too, but rather that the process of liquidating and transferring securities is much slower than ACH or Zelle.
This is not merely a theoretical risk. Patelco (a Bay Area credit union with half a million members) got hit with ransomware back in 2024 that disrupted banking services for two weeks.
And in a worst case scenario where I can’t access the front half of my savings due to a bank run or other failure, I am only a week or so away from getting access to some part of my savings.
That doesn't seem relevant here. The account disappeared due to a data maintenance error; it wasn't extracted via a legitimate transfer to another account, they literally forgot about it.
When the Silicon Valley Bank collapsed, funds were only inaccessible for 72 hours, and no depositors lost any money [0]. Which is still not ideal, but most people will never experience a bank collapse, and there are plenty of banking activities that will take longer than 72 hours to process in regular circumstances anyways.
[0]: https://en.wikipedia.org/wiki/Collapse_of_Silicon_Valley_Ban...
A glitch prevented her account from being displayed for a few days, then was resolved. Your money, when covered via FDIC/SIPC and federal regulations, doesn’t just “disappear”.
My bank just sends a note that a statement is available, rather than an actual statement.
Which is why all of my accounts mail a physical statement each month. Yes, just about every time I log on they beg me to switch to electronic only, I say no and move along.
> My bank just sends a note that a statement is available, rather than an actual statement.
Yep. If they had implemented it just like the mail, they'd just email me the PDF (encrypted if necessary). But they don't, so I don't ever agree to "go electronic statements".
Pretty much had to physically find it myself. Was the last time I let that happen…