Protecting Money

anon_private

Soon I will be receiving money into my current bank account, most of which will be used to purchase a flat.

I would like to keep the money in my current account so that I can either write a cheque, or transfer money when purchasing a flat.

The problem is that the amount of money in the account will exceed the amount protected.

Any advice please.

SuzieSue

You might be covered by this:

https://www.fscs.org.uk/what-we-cover/questions-and-answers/qas-about-temporary-high-balances/#question0

AdrianC

It would quite possibly come under the FSCS Temporary High Balance scheme.
https://www.fscs.org.uk/what-we-cover/questions-and-answers/qas-about-temporary-high-balances/

Even if the money is protected when the bank goes south, you'll quite likely have a long delay before you can access it.

It's very unlikely any bank is going south in the near future.

davidmcn

AdrianC wrote: »

Even if the money is protected when the bank goes south, you'll quite likely have a long delay before you can access it.

Which is one argument for splitting the amount between different banks.

xylophone

When will the cash actually be required for the purchase?

ermine

anon_private wrote: »

I would like to keep the money in my current account so that I can either write a cheque, or transfer money when purchasing a flat.

The problem is that the amount of money in the account will exceed the amount protected.

NS&I Income bonds? NS&I is backed by the government who are also behind the FSCS scheme

When customers invest in NS&I products, they are lending to the Government. In return the Government pays interest or prizes for Premium Bonds. We offer 100% security on all deposits.

so the FSCS limit doesn't apply. I guess in the case of war, insurrection or other catastrophe it could still go wrong, but then you've got zombies crawling the streets and bigger problems.

Although they are called income bonds they are instant access and no penalty. the 0.75% APR isn't likely to thrill you, though, but you can't knock the security.

macman

Another vote for Income Bonds. 0.75% is still better than the zero interest you are probably getting by keeping it in your current account.
You are not going to be buying a property at 24 hours notice, so there should be plenty of time to consolidate your funds as the schedule demands.
You could also put the maximum £50K into Premium Bonds for a few months.

anon_private

The money is likely to be in the account for a few months (guess). Once, I have selected the property I will be looking to buy.

anon_private

I know that the FSCS protects in the case of a crash (limited amount). I am more concerned regarding fraudulent transactions. In the case of fraud, would the bank be obliged to refund?

Crashy_Time

http://www.ctvnews.ca/business/home-capital-shares-plunge-after-signing-deal-for-2b-credit-line-1.3385637

eddddy

anon_private wrote: »

I know that the FSCS protects in the case of a crash (limited amount). I am more concerned regarding fraudulent transactions. In the case of fraud, would the bank be obliged to refund?

It depends on how the fraud was carried out.

Most banks say that if you're grossly negligent, they won't cover your losses. (For example, if you write down your PIN and store it with the debit card for the account.)

Or if you are 'socially engineered' into transferring money, for example by a fraudster pretending to be a bank employee - again the bank is unlikely to cover your losses.


In general, the money will be safer in an account that has no debit card or cheque book associated with it (perhaps a savings account) - because then there is no debit card or cheque book to steal.