How much should you have max in one saving account ?!?

Flying_the_globe

How much should you have in one savings account incase a bank or building society goes under?!?

xylophone

http://www.moneysavingexpert.com/banking/

FLAPJACK

The "safe" maximum to have is £85k....however look at the interest rate of the account, work out how much that will work out to in cash and then deduct that from the £85k, then pay in that sum total.

If you don't and the institution goes belly up and you have put in £85k you will only get that back i.e you have lost the interest gained.

YorkshireBoy

FLAPJACK wrote: »

The "safe" maximum to have is £85k....however look at the interest rate of the account, work out how much that will work out to in cash and then deduct that from the £85k, then pay in that sum total.

If you don't and the institution goes belly up and you have put in £85k you will only get that back i.e you have lost the interest gained.

Of course you can double the above if the account is held in joint names.

However, as a couple you probably wouldn't want all your eggs in one basket anyway, should you be fortunate to have such savings!

OP, every financial provider has details of the FSCS protection on their website and in paper format in branch. I'm surprised you've missed the aforementioned £85K figure when you've been looking into it?

oldvicar

I'd say:

Savings under 1 month's income: one account is fine.

Savings in 4 or 5 figures (up to £99K): split between two or more accounts, hoping that they don't both/all get in to in trouble at the same time. Worth having at least 2 accounts even below the compensation limit just to make sure you have access to money if one has difficulties (from financial problems to something as simple as a computer fault or staff going on strike).

Savings in 6 figures (£100K to £1million): Two or more, preferably keeping within the £85K limit for each (except NS&I could be safe for larger amounts)

Savings over £1M: Keeping within the £85K becomes difficult, but spread it around a good few banks to lower risk.

Trentenders

It is often quicker to search online for an answer when the question is fairly straightforward...

pqrdef

Flying_the_globe wrote: »

How much should you have in one savings account incase a bank or building society goes under?!?

The answer is that it doesn't work that way. It's by institution, not by account. If an institution goes bust, you get compensation up to £85K against the net amount that you are owed by the institution, across all accounts (which may be under different divisions or brands or trading names). That's after deducting any loans or fees or any other money you owe them, but it may include future interest due.

oldvicar

pqrdef wrote: »

The answer is that it doesn't work that way. It's by institution, not by account. If an institution goes bust, you get compensation up to £85K against the net amount that you are owed by the institution, across all accounts (which may be under different divisions or brands or trading names). That's after deducting any loans or fees or any other money you owe them, but it may include future interest due.

I thought it had changed so that savings up to £85k (per institution as you point out) are protected in full, and not netted off against loans etc.

Above £85K then savings are eligible to be taken to offset against loans.

amiehall

oldvicar wrote: »

I thought it had changed so that savings up to £85k (per institution as you point out) are protected in full, and not netted off against loans etc.

Above £85K then savings are eligible to be taken to offset against loans.

When did this happen?

oldvicar

oldvicar wrote: »

....
Worth having at least 2 accounts even below the compensation limit just to make sure you have access to money if one has difficulties (from financial problems to something as simple as a computer fault or staff going on strike).

OMG, I may be noted for my prescience , but it seems I'm turning in to a bit of a jinx too ... as I wrote the computers at the country's biggest bank (Nat West / Ulster / RBS) were in meltdown :eek:and people are having problems getting and sending money today. They will get it sorted though.