Are your savings safe? article discussion
Comments
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Just read your article on safety of banks. Went to S&Ps site to get a rating on Landsbanki (ICESAVE). It is not listed. Is this a problem? Many thanks for your great articles and website.MSE_Martin wrote: »It has. If you read this week's email you will see we've been talking to the FSA about it and the guide has been updated
Savings and debts are reconciled.
Martin
mycar370 -
rozeepozee wrote: »I think that I am. In fact, that's why I offset it because I get the benefit of it being deducted from my expenses but it doesn't actually cost what is reflected on paper because of the offsetting.
That's how I thought it worked anyway and what my accountant advised.
I guess I could have an ordinary mortgage and the money in savings with a different institution but then I'd be taxed on the interest on that.
Do you mean that you get the interest allowed as a legitimate expense, but you are not actually paying the interest, as it is offset!!!!
Interested to know if you can do this. I thought this wasn't allowed as you can only claim as expenses costs you have incurred. If the offset has meant you haven't actually paid the interest, I would hve thought you can't claim it as an expense.
If you really can do this, I would be very interested to know (as I could do similar).
Sorry if I've gone off topic.I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
RDL7553181 wrote: »Does anyone know the terms under which businesses are covered by FSCS? I can't find information on the FSCS web site. Are limited companies covered? If so, are they treated as a seperate entity (and therefore safe for £35k)?
Thanks for your help.
RDL
I think I can answer my own question! I spoke to a very helpful lady at the FSCS. She said that small businesses (as defined by the Companies Act ie limited companies with turnover of less than £5.6m*) are treated as separate entities and that savings of up to £35k with any bank are covered in the same way as individuals savings are covered. She did however make the point that sole traders and partnerships are not separate entities and that money held in business bank account by a sole trader or partnership would only be covered as part of that sole trader's or partner's personal cover.
In a nut shell:
- Small limited business, £35k cover per bank
- Sole trader or partnership, £35k cover per bank but only as part of personal cover (not £35k + £35k)
* It might be worth checking the turnover threshold, I did see on another site that the British Bankers Association define a small business as one with turnover of less than £1m.0 -
Following Martins advice I recently opened an account with Icesave believing that the first 35,000 were covered by the FSCS but now I hear that a proprotion of that is covered under the passport scheme. Does any one know how this works in practice. Is my money any less safe than with a standard UK bank0
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One of the rating companies recently investigated Iceland's ability to support the guarantees of its banks and concluded that it could. So you might face a somewhat longer time in getting your money back but should be fine.0
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Following Martins advice I recently opened an account with Icesave believing that the first 35,000 were covered by the FSCS but now I hear that a proprotion of that is covered under the passport scheme. Does any one know how this works in practice. Is my money any less safe than with a standard UK bank
The passport scheme works like this :
Banks fails.
You claim via the FSCS / Fsa Scheme
In the case of passport FSA co-ordinates, with the banks homes country scheme (Iceland, Republic of ireland or wherever)
First amount of payment say £15k in icelands case is paid, by them to the fsa, they top up to £35k, and pay you.
As this has never happend with a bank it not ceratin how long the claim(s) will take, I have seen six months mooted, tho.
And
If the fsa are not coughing up, or have other matters in hand, say a UK bank issue, you can claim directly off the home country scheme.
or
If the other country does not pay up. The FSA will cover the whole amount.
So you have double cover for the first £15k with passsport schemes that you don't have with FSA alone.0 -
My building society Birmingham Midshires have agreed that i can move my account, but i would lose 90 days interest.
They were quite happy with the situation and put up no resistance other than loss of interest, which is of course the norm.
It does seem to give some confidence that they are not refusing withdrawals, especially as mine is quite a considerable deposit. So now i still don't know what to do. Is it any safer with the Banks receiving more help from BOE, and the FSA admitting lack of supervision and promicing more stringent checks .0 -
HOLLY, good to hear that they were accommodating. It's no more or less safe than it was before: as part of HBOS that particular building society is not likely to fail. HBOS has already demonstrated that it can survive a deliberate attack.
But if you're still worried, move much of the money and take the loss. It's not worth losing sleep and wondering. Perhaps give it a week and then act based on whether you're worring about it at night or not.0 -
“Any debts with the same institution are subtracted from your savings
A piece of minutiae in the Financial Services Compensation Scheme rules dictates that if you have debts, such as a mortgage, loan or credit card with a bank that you also have savings with, any outstanding debts will be subtracted from the savings. For example if you have £20,000 in savings and a £15,000 loan, in the unlikely event that bank went bust you'll only get £5,000 compensation.
“
I called the FSCS about the above piece of information, with respect to offset mortgages. The example i gave was you owed 100K (off set mortgage) , had 105K in the bank. In the case of a bank failure, you would not necessarily have the 100K mortgage cleared and put in a claim for 5K. Instead you may end up still owing 100K and only be able to claim 35K. The person i spoke to they would try to provide the service as described in the article , but in the end, it would be a government policy decision at the time of the claspe. He kept using te phrase “Right of Offset” which would need to be in the morguage agreement
Can anyone clarify the situation, i.e written examples ro government / FSCS documentation?0
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