is this correct? regarding fsa limit of 80k

geoffky

we where worried about being over the 160k limit for the banks so i phoned up and asked for a transfer so i can use another bank for another 80k.so the bank asks me why do i not just add another person over 18 (my daughter)to the account..making it 3 people...would this work as far as the government are concerned in the event of the bank going bust..we have done this but i need confirmation what they have told me is correct.

it is a good rate being over 5% and the reason why i was reluctant to move some

atush

First of all, I thoght the rate was 85K pp. and I thought joint might br the max, but see no readon under banking law that you could not get another 85K. Except some banks may only allow 2 persons on certain accts (as 3 is more than normal so might have to be shunted over to business accts etc). So check with yoru bnak concerned, and remember that some banks and building scoeities are on the same license so you only get one 85Kpp even if you hve an acct in 2 linked institutions.

Gromitt

It is 85K per person, per bank license (upto 170K for joint accounts)

alanq

If your daughter's name is on the account then a proportion of the money is hers to do with as she wishes. (Perhaps all of it?) Is that what you want? If she has her name on the account she may miss out on some means tested benefits. Is that what she wants? If she marries and divorces the funds may be taken into account as part of any settlement. etc. etc.

It's a stupid idea. Find one or more other banking groups to open accounts with. Apart from FSCS considerations it would give resilience against systems failures, strikes and other major events that can disrupt services.

soulsaver

If its already in two names (joint) you are covered up to £170k and need do nowt, zilch nothing....Just relax you are covered.
PS what's paying 5%?

Ifts

geoffky - Under the Financial Services Compensation Scheme (FSCS), you get back up to £85,000 per person per financial institution, cash in joint accounts counts as half each, so together you've £170,000 protection.

This link explains it in more detail: http://www.moneysavingexpert.com/savings/safe-savings

I myself have never had an account in 3 names so I cant say if the individual limit of 85K is multiplied by 3. I have never heard of this before (thats not to say it isn't possible).

However even if it is possible I don't think it would be a wise thing to do. I think that alanq makes some important/valid points in his post above. It could get messy if things go wrong as your daughter will be the legal owner (of all/her share?) of the money.

soulsaver wrote: »

If its already in two names (joint) you are covered up to £170k and need do nowt, zilch nothing....Just relax you are covered.

Maybe I'm missing something here but I'm not so sure about that.
IMO its is not clear from the OP's original post exactly what the balance is. From what I can make out, it is above £160k but we are not sure if it is below £170K (joint FSCS limit).

geoffky wrote:

we where worried about being over the 160k limit for the banks so i phoned up and asked for a transfer so i can use another bank for another 80k.

Maybe geoffky can clarify exactly how much money they have in total in this account.

le_loup

alanq wrote: »

If your daughter's name is on the account then a proportion of the money is hers to do with as she wishes. ,,,,,,,,,,,,,,,

And, of course she would have to pay 1/3rd of the tax on the interest. Bet she would be chuffed at that.

dunstonh

Just for reference, there is no FSA limit. You are refering to the FSCS limit. It is also not Govt funded (although the Govt can lend money to it as a form of a loan which needs to be repaid).

geoffky

sorry all for lack of meat...balance is over 250k daughter will not pay tax as it is taxed at source..She does not need or get any benefits and if she did i could give 90 days notice to withdraw..
The over 5% was the interest rate the bond pays.I have it all in writing that there are now 3 names and holders of the bonds..

she could not withdraw her bit as it now needs three names to make a withdrawal and that requires 90 days notice.

le_loup

geoffky wrote: »

She does not need or get any benefits and if she did i could give 90 days notice to withdraw.

And by cashing in and giving the money to you, do you not think that any benefit giver would be just a little interested.
And, of course she will be considered as paying tax on her 1/3rd or are you going to submit an R85 for her.

There are real complications in what you propose, far better to spread the money around other providers. If the money is put in someone else's name, it is theirs!

jem16

geoffky wrote: »

sorry all for lack of meat...balance is over 250k daughter will not pay tax as it is taxed at source..

She might if the interest on it takes her into the next tax band.