Are your savings safe? article discussion

John_Pierpoint

Are they not 3 month notice?
Presumably the branch in the City of London is UK registered licensed and an English company.

(The Zebra logo is a bit of a give away as to the location of HQ)

Even when those banks, based on a lump of volcanic rock in mid Atlantic, went bust, the private investors were covered by a mixture of the banking compensation and the Terrorism act.

http://forums.moneysavingexpert.com/showthread.html?p=16447871
http://forums.moneysavingexpert.com/showthread.html?t=1469637
http://www.thisismoney.co.uk/savings-and-banking/article.html?in_article_id=440726&in_page_id=7

LongTermLurker

Even when those banks, based on a lump of volcanic rock in mid Atlantic, went bust, the private investors were covered by a mixture of the banking compensation and the Terrorism act.

Madeira? When did that happen??

If you mean Iceland, that's distinctly North Atlantic...

investornot

If a father and son have a joint bank account with £100k in it, which was achieved by the father putting in £99k and the son £1k,would the whole £100k be protected under the FSA compensation scheme or only £51k?
You can see where I am going with this. Please no guesses, only reply if you know the answer, and if you can refer me to some text/rule book that confirms this or not it would be a great help.

Patr100

Have you read the article on Protection?

The limit's doubled in a joint account.
Money saved in an account registered in two names receives twice the protection; that's therefore the first £100,000. Don’t get too excited though, this isn’t an extra allowance; it’s simply the same protection as if each account holder had a separate account.
In fact the best way to think about this is half the money in the account belongs to each person. An example should help...
Sensible Steve has £100,000 in a joint account in RiskyBank with his girlfriend Saver Sally, plus £20,000 in a separate account of his own with the same bank.
If RiskyBank went bankrupt, then if you consider half the joint account money, £50,000, is Steve's, then added to his separate savings that's £70,000. Which means he would lose £20,000.

This means, if you work through it, it is possible that you lose out by having a joint account...
Imagine Reckless Rick and his partner Rachel have a RiskyBank joint account with £90,000 in, plus Rachel has £10,000 in her own account with the same bank.
Here, if the bank went bust, the full joint account balance would be covered; it is split out as £45,000 each, so Rachel only then has £5,000 worth of protection left to cover her separate account, leaving the other £5k at risk.
So even though between them they've only £100,000 in savings, it's not all covered by the compensation scheme. They would've been better off simply having all the money in the joint account, or having £50,000 in separate accounts each.

http://www.moneysavingexpert.com/savings/safe-savings#collapse

Old_Wrinkly

investornot wrote: »

If a father and son have a joint bank account with £100k in it, which was achieved by the father putting in £99k and the son £1k,would the whole £100k be protected under the FSA compensation scheme or only £51k?
You can see where I am going with this. Please no guesses, only reply if you know the answer, and if you can refer me to some text/rule book that confirms this or not it would be a great help.

For some reason, I was reading the FSCS website a couple of nights ago, and this particular point caught my eye as they don't paint it quite as clearly as Martin & his team do. It's along the lines of money in a joint account will be regarded as being the equal property of each, unless there is some reason to decide otherwise. If in your example, the boy was only 10 (say) and his money came as a result of a bequest (say), then that might give sufficient reason.
I'll dig out an appropriate link for you.

here the link (see Answer 1)
http://www.fscs.org.uk/what-we-cover/questions-and-answers/qas-about-claiming-compensation/qas-about-deposits/

Actually, I can just as easily cut and paste the relevant bit ...

Q1. I have my money in a joint account in a High Street bank. How would FSCS pay compensation if the bank failed?

A1. The compensation limit of £50,000 applies to each depositor for the total of their deposits with an organisation, regardless of how many accounts they hold or whether they are a single or joint account holder. In the case of a joint account, FSCS will assume that the money in that account is split equally between account holders, unless evidence shows otherwise.
This means that each account holder in a joint account would be eligible for compensation up to the maximum limit.

(Note: I highlighted it in red, not the FSCS site)

MarkyMarkD

The limits are irrelevant.

The government always pays out whatever amount you have invested.

Stop wasting your lives worrying about the irrelevant limit.

I-LOV-MONEY

So far ... what if they stop ?

JimmyTheWig

MarkyMarkD wrote: »

The limits are irrelevant.

The government always pays out whatever amount you have invested.

Stop wasting your lives worrying about the irrelevant limit.

It depends on the gain for doing this.
By going over the limit you're taking a risk. Why bother? Why not just split the money up?

Old_Wrinkly

MarkyMarkD wrote: »

The government always pays out whatever amount you have invested.

The government does what is politically expedient. If a bank failed and the only customers who had more than £50K deposited were fat-cat bankers, and others who do not currently have a high popularity standing, then what?

expatasia

Say you held 250k Sterling in an instant access account offshore (IOM or Guernsey ie. potentially risky) gaining virtually no interest and you were barred on resident grounds from opening UK mainland bank accounts or a NS & I saver account, where would you put the money in the current climate?