MSE News: Safe savings limit to fall by £10,000 to £75,000 from January 2016

Former_MSE_Paloma

If you've got more than £85,000 saved with one institution, you should start thinking about moving your cash around...

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Safe savings limit to fall by £10,000 to £75,000 from January 2016




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Archi_Bald

MSE, can you please merge this with https://forums.moneysavingexpert.com/discussion/5279539

Yodaboy

So if you have opened an ISA this year, transferred in and have over £75k in it, what can you do to protect the extra?

Fella

Sends a poor message, whatever the reason, reducing the limit will make at least some people think there's an increased risk of the guarantee being used at some point & that's why it's been reduced.

Archi_Bald

Discussion in the other thread explains https://forums.moneysavingexpert.com/discussion/5279539

polyphonic99

With the Greek Banking system on the verge of collapse, with possible contagion to the rest of the Eurozone, what better time for the idiots at the Bank of England to undermine confidence in the British banking system.

Surely the EU rules say deposit protection should be "AT LEAST" equivalent to 100,000 Euros. If the Euro depreciated to say 5 Euro to 1 GBP, then the current logic would say that the UK should only offer £20,000 protection. This is absolutely bonkers.

If you take account of 25% inflation since 2010, then the actual value of the deposit protection will not be reduced from 85,000 to 75,000 but to 53,000.

jamesd

Here's the list of things covered by the temporary high balance rule.

masonic

jamesd wrote: »

Here's the list of things covered by the temporary high balance rule.

Interesting:

Why is FSCS now covering temporary high balances when they didn’t previously?

The protection of temporary high balances is a requirement under the Deposit Guarantee Schemes Directive (DGSD). This standardises the protection of money held in banks, building societies and credit unions across the EU.

jamesd

The EU has never done anything for us some might say, forgetting things like this.

The increase in non-investment annuity compensation from 90% of what a judge determines is the appropriate amount to 100% of that is also good news that will reduce the potential for income loss for annuitants, making it easier to go for the highest rate without regard for the quality or stability of the annuity provider.

MARTYM8`

As some one who experienced the Dot Community debacle with my ISA earlier this year its worth noting this protection only applies if the bank/credit union/building society collapses/goes into administration.

As we all found the organisation can basically have cash flow issues/fail to meet regulatory requirements and deny you access to your cash for weeks or even months (4 months in our case) while the regulators mess about trying to sort the problem out. We eventually got our cash when it went into administration - but imagine being told sorry you may want your funds but you cannot have them for 4 months!

And this doesn't apply to bail ins either - which have occurred in Cyprus, are likely to occur in Greece (30% hit on deposits in a bank of more than 8,000 euros if you believe the FT yesterday) and if our banking system goes pear shaped again maybe here one day.

And of course the limit is linked to the value of the euro - if that falls against sterling the protection declines.

So its not quite what it seems - you can be bailed in and lose some of your money.

masonic

MARTYM8` wrote: »

And of course the limit is linked to the value of the euro - if that falls against sterling the protection declines.

It depends which scheme the bank relies on. The FSCS scheme will be fixed in GBP for 5 years, but the passport scheme (used by a minority of foreign banks) will be based on their local currency and you will get the prevailing exchange rate at the time.