Mellody's Money Survival Guide: What Not to Do During a Credit Crisis

Sept. 25, 2008 — -- With the nation's financial crisis on everyone's minds, many Americans are worried about how to keep their money safe. Is this the time to move your cash?

In this edition of Mellody's Money Survival Guide, "Good Morning America" takes a look at the five things you should not do with your money right now.

Do you have a question for Mellody about your finances? Click here to email her a question.

When people panic, it's basically their brains saying, "There is danger. You have to do something." If, however, you have been prudent before the turbulence hit, the sensible thing may be to resist the urge to act.

Through Sept. 19, there have been just fewer than 20 banks that have "failed" in 2008. True, nobody would prefer to have their money in a bank that fails, but your money is safe.

The federal government created the FDIC, the Federal Deposit Insurance Corporation, in 1933 to backstop banks and prevent Americans from losing their money. Specifically, savings and checking accounts are insured to $100,000 per depositor in each bank or thrift (a savings and loan) that the FDIC insures.

So if you are one of the vast majority of Americans with less than $100,000 in the bank -- $200,000 if married -- then you simply don't need to fret should your bank get into trouble.

Your credit score is the key piece of information that affects decisions on everything -- from whether or not you get a loan, credit card, home or job.

The national average is 676, but individual scores can range from 330 to 830 -- the higher the score, the lower the credit risk.

According to the Public Interest Research Group, one in four credit reports has errors that are serious enough to disqualify consumers from opening a bank account, purchasing a home or even getting a job.

The easiest way to obtain a free credit report is to log on to www.annualcreditreport.com

Additionally, you can obtain a copy of your report by calling the toll-free numbers of the respective big three: Equifax, Experian and Transunion.