Preparedness for when

jk0

calicocat wrote: »

Can I just ask why people are saying to have only essential money in the bank? Is it because if something happens we would have trouble accessing it as they would just not allow it....or worse that we would lose it altogether.....and that the 85K safety thing is a lie.

The problem is there is not enough in the FSCS kitty for everyone to draw out their savings under £85k.

If there was another bank run, (remember Northern Rock in 2007), at a much larger establishment, they would have to impose withdrawal limits of a few hundred pounds as they did in Cyprus, Iceland etc.

calicocat

jk0 wrote: »

The problem is there is not enough in the FSCS kitty for everyone to draw out their savings under £85k.

If there was another bank run, (remember Northern Rock in 2007), at a much larger establishment, they would have to impose withdrawal limits of a few hundred pounds as they did in Cyprus, Iceland etc.

I always keep cash out to survive if they stop withdrawals for a few months as don't trust them. Was just wondering people thoughts on the 85K thing...as again I don't trust them. Not that I have that much..!!..but I do have savings and want to keep them.

Note to self to chuck as much as I can at the mortgage without taking a hit on overpayments.

Thanks for replies.

jk0

calicocat wrote: »

Was just wondering people thoughts on the 85K thing...as again I don't trust them.

Thanks for replies.

I expect your savings up to £85k will always appear on your regular bank statements. Whether you will be able to draw them out is a different matter.

Now, isn't that rather similar to having savings in another country that won't release them? It's not a situation I would like to be in, but I guess we're stuck with it. I have one quarter of my money in each of four banks, and hope for the best.

Like you I keep a few thousand in cash.

COOLTRIKERCHICK

It doesn't matter if you got 100k or 1k in the bank, its your money, and you have earned and saved hard to have it...


I don't have a load of cash in or out of the bank.... But How I am prepping is making sure I have enough food etc in the house..


I am also trying to get to grips with making bread.... and going back to basics with cooking and baking.. for two reasons.. I need to be super Frugal in 2014, PLUS... I want to know what is in my food... and thirdly ( ok I just remembered this one) To stop relying on supermarkets and these big corperate companies for my food...


If SHTF ... due to weather, global financial reasons... etc.. I will have the raw ingredients in my store cupboard to make most things....

paidinchickens

ctc

I totally agree with what your saying. Not having to rely on anyone is our driving force.

The allotment, soon to be bees etc is a step in the right direction but the worry is when TSHTF it will be ransacked in a heartbeat. People already have their crops stolen.

PiC x

nuatha

Bedsit_Bob wrote: »

I wouldn't even get my feet wet.

Hopefully you wouldn't need to go anywhere or need stuff getting to you.
A 20m tidal wave will take out a huge amount of infrastructure in the UK

calicocat wrote: »

Can I just ask why people are saying to have only essential money in the bank? Is it because if something happens we would have trouble accessing it as they would just not allow it....or worse that we would lose it altogether.....and that the 85K safety thing is a lie.

The 85K is slightly above the current haircut level (£83.5K on todays exchange rate) the legislation to use bank deposits rather than government funds to fund bank bailouts was agreed a few weeks ago. Whether the haircut level will remain at 100k Euros is anyone's guess, mine is that it will brought in at a significantly lower level, the initial plan in Cypress was 6.7% of all deposits below €100000 and 9.9% from those over. (What I've rarely seen mentioned is that the eventual solution included an automatic rollover of all government bonds, supposedly one of the safest lower return fixed term investments)

The 85K is a politicians promise, and therefore is valid for as long as it may be convenient or until they need to make good on it.

nuatha

calicocat wrote: »

I always keep cash out to survive if they stop withdrawals for a few months as don't trust them. Was just wondering people thoughts on the 85K thing...as again I don't trust them. Not that I have that much..!!..but I do have savings and want to keep them.

Note to self to chuck as much as I can at the mortgage without taking a hit on overpayments.

Thanks for replies.

Aside from anything else, overpaying your mortgage (up to what ever penalty limits you have) is probably the best return you can get on your savings given current interest rates.

GreyQueen

Afternoon all.

I have been inducting Mum into the advanced arts of baragaineering. We turned Tosspots points into clothing vouchers earlier this month and have "bought" 4 pairs of jeans for the bruv, who is a lowly s/e peep on a very small income. Then we hit up various shops inc Aldee an F.Foods for things we could get better-priced than at Tosspots.

I always bear my mother's advice when confronted with ridiculous price hikes; don't pay that, you'll only encourage them!

Re financial cover up to £85k per institution. My total net worth is well shy of that, but my thoughts on the guarantee is that the govt has put it into place to allay fears over the stability of banks. I don't believe for a moment that they have costed-out the failure of a major retail bank in the UK and how much they would have to find in compensation, or on what time scale they would be able to find it. And it might be a lot more than one at a time.

Gubbermints don't have a forest of money trees (more's the pity) they have what the can extort from their populations in taxes or borrow on international markets. Plus such national assest that they haven't already hocked-off for well below their value. And yes, 'Prudence' Brown, flogger of an awful lot of our gold reserves for chump change, I am talking about you. And am bliddy p'd off that I didn't get me some at a discount.

So where would they find the compensation money? And how quickly? Would it be days, weeks, months, years? Would they decide that deposits over a certain threshold would be converted into bonds, essentially government paper promises?

And what will you do for spending money in the interim? How do you eat, and pay your bills?

I did O Level economics back in the late seventies and fractional reserve banking scared the carp out of me even as a teenager. Money in a bank account with your name on it isn't your money. You are officially a creditor of the bank. Morally, it's your money, but legally, it's the bank's money. Unless and until you understand this, you won't be able to act in your best interests. I doubt one person in a thousand really understands how the banking system works.

It's their money until you extract it. And once the SHTF with an institution, Uncle Tom Cobbley and all will be after their dosh, and fractional reserve banking means that there is probably £1 available for every £100 listed on people's bank accounts.

I have a small float in the bank (£300-£500, depending on the point in the month) over and above the DDs for the bills and other than that, I get my money out the very day it goes in. Pay cash for everything and invest in tangibles.

Have got breadflour and yeast and lots of grub. Plus some other manoevers which I don't mention on the interwebs or in RL. If we do have a major financial crash, it won't be a question of coming out unscathed, it'll be a matter of damage limitation.

Perplexed_Pineapple

COOLTRIKERCHICK wrote: »

apart from making sure there is only pennies in our bank accounts, just enough to cover SO and DD. how are you going to prep for this?


I think if it doesn't happen soon, it will happen at one point...to me I relate to it as an bad open wound that the government just keep on putting a sticky plaster over, but it should have been seen to asap. but it doesn't matter how many plasters you put on it... the infection has set in... and its only a matter of time before it gets to a point where there is nothing you can do about it...

Totally agree, what I'm doing to prep is making sure that I have enough supplies in to not need to rely on the shops for a couple of months (we'd cope, although our diet might get a bit boring!)., stockng up on seeds to supplement stores with seasonal crops, and most importantly of all trying to acquire skills and tools to make the best of disaster. If we're hit by a 20m tidal wave the stocks and stores will take a big hit, but the skills will survive as long as we do.

nuatha wrote: »

Aside from anything else, overpaying your mortgage (up to what ever penalty limits you have) is probably the best return you can get on your savings given current interest rates.

That's a dilemma I have at the moment, I have a few K in the building society, nowhere near the 85K limit for protection, which is intended to go towards my mortgage. It's in the building society for two reasons: I like to have some cash for emergencies, and would prefer not to keep it under the mattress; also I'm amazingly getting a better return on my savings than my mortgage rate. It's a gamble of course, if my building society account takes a "haircut" the debt will still remain. Also I have a smaller amount of credit card debt - aiming to have that paid off in the next couple of months.

calicocat

nuatha wrote: »

Aside from anything else, overpaying your mortgage (up to what ever penalty limits you have) is probably the best return you can get on your savings given current interest rates.

Yes, I am doing this every month at the moment, but no to the max, so as to keep saving funds (supposedly) available if needed for other things. Think I will top up to the max though with the savings when they haven't been needed.

Also stuff my mattress...lol....and buy a fire proof safe.


Actually when I was buying my house I was shifting money around like a lune to keep accounts under the 85K, the bloke at the bank did say it was pointless as if they went down it was screwed anyway....bit of a frightening thought, and wasn't sure how serious he was being.