The number of people enquiring about and opening savings accounts surged in the spring, as they sought to secure a safe home for their money and to lock into favourable rates before interest rate cuts fed through to savings rates.
The good news is that the Financial Services Compensation Scheme (FSCS) can provide a safeguard adding a valuable level of reassurance for UK savers. For any money you hold in an account with a UK-authorised bank, building society or credit union that fails, the FSCS will compensate you:
- up to £85,000 per eligible person, per bank, building society or credit union
- up to £170,000 for joint accounts.
Finer detail
The FSCS will automatically cover you; you do not need to take any action. You need to be on top of your cash balances because the cover applies to the total sum of money held, and because some banks share a banking licence, this will affect how much of your money is protected. So, if you hold over £85,000 / £170,000, it needs to be spread across different banks that don’t share a licence to benefit from the protection. If you hold multiple accounts with banks that share the same banking licence, anything you hold over £85,000 / £170,000 in aggregate will not be protected. Keep on top of your cash balances with our help.
It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from, taxation are those currently applying or proposed and are subject to change; their value depends on the individual circumstances of the investor. No part of this document may be reproduced in any manner without prior permission.
The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. If you withdraw from an investment in the early years, you may not get back the full amount you invested. Changes in the rates of exchange may have an adverse effect on the value or price of an investment in sterling terms if it is denominated in a foreign currency.
Information is based on our understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.
Tax treatment is based on individual circumstances and may be subject to change in the future.
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