The 85k limit guarantee
Discussion
Stepdaughter about to come into some cash (cf. previous threads, and thanks for that advice - sum is c. £200k).
My understanding is that the 85k guarantee only applies to banks from different financial institutions - i.e. if you have 200k in 3 banks, but they are different banks, but members of the same financial institution, and they went bust, you’d get a max of £85k back.
How easy is it to track down the ‘ownership’ of banks, as we’d like to spread it with minimum risk, at least until we (ok, she) would like to invest it?
As a total aside, what happens with money protection from lottery winners? At least until IFA’s get involved, they must be at serious risk, surely? Ok, likelihood low, but severity high. I believe there is a ‘get out’ for a certain time period for people who, for example, sell a house and then later buy another?
My understanding is that the 85k guarantee only applies to banks from different financial institutions - i.e. if you have 200k in 3 banks, but they are different banks, but members of the same financial institution, and they went bust, you’d get a max of £85k back.
How easy is it to track down the ‘ownership’ of banks, as we’d like to spread it with minimum risk, at least until we (ok, she) would like to invest it?
As a total aside, what happens with money protection from lottery winners? At least until IFA’s get involved, they must be at serious risk, surely? Ok, likelihood low, but severity high. I believe there is a ‘get out’ for a certain time period for people who, for example, sell a house and then later buy another?
You can check which banks or financial institutions have single or shared licences here
https://www.fscs.org.uk/what-we-cover/banks-buildi...
https://www.fscs.org.uk/what-we-cover/banks-buildi...
This tells you whether a bank is linked to other banks (and if it is, whether the protection is seperate because apparently it can be) :
https://www.moneysavingexpert.com/savings/safe-sav...
https://www.moneysavingexpert.com/savings/safe-sav...
2 sMoKiN bArReLs said:
As an aside...
....I've always wondered if say HSBC went bust could any scheme actually cope? (Given all the huge fallout from all over).
Hopefully we will never know!
My mum used to lie awake at night worrying about NatWest going bust. She was in care home and they were taking all her money anyway, and if it all went then the LA would pay.....I've always wondered if say HSBC went bust could any scheme actually cope? (Given all the huge fallout from all over).
Hopefully we will never know!
I've always taken the view that if high street banks start going bust then all bets are off.
2 sMoKiN bArReLs said:
As an aside...
....I've always wondered if say HSBC went bust could any scheme actually cope? (Given all the huge fallout from all over).
Hopefully we will never know!
No, in short. The core purpose of the scheme is to remove the risk of a run as well as to attract capital in the first instance. ....I've always wondered if say HSBC went bust could any scheme actually cope? (Given all the huge fallout from all over).
Hopefully we will never know!
If you go to https://www.flagstoneim.com you can get an illustration of their rates and it shows the banks they would use.
As they claim to spread your money around so you get full FSCS protection I'd hope the illustration gives a quick way to see the best mix of rates whilst benefiting from separate FSCS licenses.
As they claim to spread your money around so you get full FSCS protection I'd hope the illustration gives a quick way to see the best mix of rates whilst benefiting from separate FSCS licenses.
OldSkoolRS said:
2 sMoKiN bArReLs said:
Greenmantle said:
Does the £85000 also include interest accrued to date or only what is on the account?
I doubt you’d worry too much about the extra £3.64 
anonymous said:
[redacted]
I think re-reading the post the question was (for example) if you had £60,000 in the account and had earned some interest (say £2000) then would you get £60k back or £62k. I don't know the answer, but I was just pointing out that interest on £85k isn't a piffling amount these days, apart from to those who might lose £85k down the back of their sofa and not miss it of course. anonymous said:
[redacted]
I got the bit about not getting a penny more than £85k, I wasn't sure about the £60-62K case though. Hopefully that makes it clear to whoever asked it now as I've assumed an example of what they were asking when I rephrased it.I agree on the HSBC/Barclays scenario too...lets hope that isn't a situation we find ourselves in.
Slightly different but same topic, how does the £85k limit work on an off set mortgage.
Example figures, say £250k mortgage and £150k in off set account.
Would this scenario guarantee the £150k and be taken off amount owed on the mortgage rather than only the £85k.
Would be harsh if off set mortgage accounts are also limited to £85k.
Example figures, say £250k mortgage and £150k in off set account.
Would this scenario guarantee the £150k and be taken off amount owed on the mortgage rather than only the £85k.
Would be harsh if off set mortgage accounts are also limited to £85k.
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