Economists advise Ohio residents on next steps after bank collapse

COLUMBUS, Ohio — The president of the Ohio Bankers League says people in the Buckeye State don’t have to worry about keeping their money safe after two banks recently collapsed because there was no effect on the banking system in Ohio.

Mike Adelman said one key difference is that Silicon Valley Bank and Signature Bank typically have accounts with large amounts of money tied to one industry, unlike the Ohio banks. He adds that the banks are well funded and are all backed by the federal government.

There are also legal tools Ohio banks have access to to extend this coverage beyond the $250,000 FDIC-insured protection.

The collapses serve as a reminder for everyone to be better informed as consumers.

“I strongly encourage friends and colleagues to build a relationship with a local banker and visit them or call them, certainly during the uncertain times we’re seeing throughout our economy, just to make sure they have some peace of mind with that bank,” he said. Adelman.

Kimberly Young of Young Wealth Management said she saw the biggest impact in the stock market.

“The main thing that my clients saw, obviously, was that it shook the stock market,” Young says.

However, Young advises not to panic at this time.

“Markets can be incredibly volatile, so yesterday was a big negative day in the market, I would have thought maybe that could happen today, but today the inflation data turned positive and it’s a really positive day in the market,” — said Young. said.

If you have more than $250,000 in a single account, you can diversify your accounts and spread your money across multiple banks to ensure you’re fully insured, Young said.

The biggest concern she has seen among clients is inflation.

A recent report showed that consumer prices rose 6% over the past year, raising new questions about whether the Federal Reserve will raise interest rates in the coming days.

“I hope that inflation will start to decrease. Now do I think it will go back to pre-pandemic levels? No.” Young said.

There are several factors that contribute to why we pay more for almost everything. Young says we don’t have enough supply to meet the high demand, which drives up costs. We also have a strong labor market right now, but there is a shortage of workers. She attributes this to a mass exodus among future retirees. Families have also re-prioritized income.

“You had people with two incomes per household who were forced to go down to one because of the childcare situation and then realized that we’re fine with one income, why don’t we just keep it going after the pandemic ?” shares Young.

Young advises you to check your accounts because many of the big banks aren’t raising interest rates, so your money in those accounts is depreciating. She says it might be better to consider your regional banks, which offer higher rates to combat inflation.

“You can get a savings account right now, liquid for 4%, which is kind of crazy, we haven’t been there in quite a while,” Young said.

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