I1L2T3 Posted August 28, 2015 Share Posted August 28, 2015 Why does the Government guarantee money in a private bank; I could understand if it was the Bank of England. Does it apply to building societies? I assume that they dont guarantee any other types of investments. It applies to any institution that is eligible and signed up to the FSCS. Banks, credit unions, building societies etc... It's totally sensible to guarantee deposits. Otherwise people would not deposit money (not just savings but wages too) into banks as then cash deposits would not be risk free. Then the fundamental basis of our everyday financial transaction system would fail. Cash deposit is not an investment is it. Link to comment Share on other sites More sharing options...
El Cid Posted August 28, 2015 Share Posted August 28, 2015 (edited) It applies to any institution that is eligible and signed up to the FSCS. Banks, credit unions, building societies etc... It's totally sensible to guarantee deposits. Otherwise people would not deposit money (not just savings but wages too) into banks as then cash deposits would not be risk free. Then the fundamental basis of our everyday financial transaction system would fail. Cash deposit is not an investment is it. So if the banks were allowed to go bust, it would cost the tax payer lots of dosh. So they can gamble as much as they like, with dodgy American loans. I dont pay cash into my bank. Edited August 28, 2015 by El Cid Link to comment Share on other sites More sharing options...
WiseOwl182 Posted August 28, 2015 Share Posted August 28, 2015 Don't be ridiculous I'm heavy into cash waiting for the right opportunity to pick up a cheap asset. There is no point risking it on silly investments. I need liquidity for what I have planned and no point it being stuck in a few thousand rotting BTL bricks. Any investor knows to have a diversified portfolio. Unless you're a millionaire and 75k is a pittance, then having so much in cash at current interest rates isn't wise (IMHO). Link to comment Share on other sites More sharing options...
Cyclone Posted August 28, 2015 Share Posted August 28, 2015 At the current rates of interest available on savings accounts, anyone stupid enough to have anything near to £75k sitting in one deserves to lose some anyway! Because there are risk free alternatives that provide good returns and allow for flexibility, right? ---------- Post added 28-08-2015 at 20:53 ---------- Any investor knows to have a diversified portfolio. Unless you're a millionaire and 75k is a pittance, then having so much in cash at current interest rates isn't wise (IMHO). That would be true if the cash is an investment. What if it isn't? Link to comment Share on other sites More sharing options...
RickyM Posted August 28, 2015 Share Posted August 28, 2015 Why keep it in the bank anyway? You get no interest and the bank still makes money from you so get your cash out people! Link to comment Share on other sites More sharing options...
Cyclone Posted August 28, 2015 Share Posted August 28, 2015 I get 1.85% on my deposit account... That's better than nothing and it's more secure than keeping it in my garage. Link to comment Share on other sites More sharing options...
RickyM Posted August 28, 2015 Share Posted August 28, 2015 I get 1.85% on my deposit account... That's better than nothing and it's more secure than keeping it in my garage. Knock the 20% off for Income Tax and it'll be less than that. The bank is making a lot more than you are!!! Hide it somewhere.........I wont come looking for it! Link to comment Share on other sites More sharing options...
drummonds Posted August 28, 2015 Author Share Posted August 28, 2015 I get 1.85% on my deposit account... That's better than nothing and it's more secure than keeping it in my garage. i still have a couple of accounts paying around 4.5%. sadly they will end shortly and i'll struggle to beat 2.25% Link to comment Share on other sites More sharing options...
I1L2T3 Posted August 28, 2015 Share Posted August 28, 2015 Any investor knows to have a diversified portfolio. Unless you're a millionaire and 75k is a pittance, then having so much in cash at current interest rates isn't wise (IMHO). I'm about 50% in cash Link to comment Share on other sites More sharing options...
Cyclone Posted August 29, 2015 Share Posted August 29, 2015 Knock the 20% off for Income Tax and it'll be less than that. Irrelevant, I have to pay income tax on whatever form of investment makes me a return, so we consider the rate before my tax for the point of comparison. The bank is making a lot more than you are!!! I don't care, I'm making as much as I can without exposing myself to more risk and/or tieing the money up in something longer term. ---------- Post added 29-08-2015 at 09:19 ---------- i still have a couple of accounts paying around 4.5%. sadly they will end shortly and i'll struggle to beat 2.25% I'll be impressed if you can find >2% without using a fixed term deposit. http://www.moneysupermarket.com/savings/search/results/?goal=SAV_NOTICE&wom=true Charter savings are current offering 1.95% on a 120 day notice account, that's the account I have in fact, but a different "issue" of the account, hence the lower interest rate. If you take a 5 year fixed term (I wouldn't do that at the moment) you can get 3%+, 2 year fixed term and you can get 2%+. Link to comment Share on other sites More sharing options...
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