FSCS Limits - interesting fact

[Zak33]

Hi all

For those who don't know and haven't heard the radio adverts, if you've got money in a major bank, and it rolls over, you're protected up to £75k of savings by the Government,

It's to stop a run on a bank turning us all upside down, but also to keep us spreading our money around the banks and not "eggs in 1 basket-ing"

was £50k back in the 2010 era and £35k before that when the world realised it was spinning too fast.

what I didn't know was the "Life Events" can allow up to 1million to be protected for up to 6 months

Temporary High Balances

From 3 July 2015, the Financial Services Compensation Scheme (FSCS) provides a £1 million protection limit for temporary high balances held with your bank, building society or credit union if it fails.

Temporary high balances are the result of specified major life events that lead to a large amount of money being held in a person’s account for up to six months.

A depositor with a temporary high balance may be entitled to receive additional compensation from FSCS of up to £1 million per life event, with unlimited cover for personal injury claims.

Proceeds resulting from the following life events are categorised as temporary high balances:
Sums paid to the depositor in respect of:

Real estate transactions (property purchase, sale proceeds, equity release)
Benefits payable under an insurance policy
Personal injury compensation (unlimited amount)
Disability or incapacity (state benefits)
Claim for compensation for wrongful conviction
Claim for compensation for unfair dismissal
Redundancy (voluntary or compulsory)
Marriage or civil partnership
Divorce or dissolution of their civil partnership
Benefits payable on retirement
Benefits payable on death
A claim for compensation in respect of a person’s death
Inheritance
Proceeds of a deceased’s estate held by their Personal Representative

http://www.fscs.org.uk/what-we-cover...eposit-limits/

[Smudger]

So if I win the lottery tonight (which I will, despite having no ticket), I've got 6 months to spread my money around?

Sweet. But that's a lot of effort, if you've got say £20m sitting there, you'd need 267 different accounts to keep your money guaranteed. I didn't realise being rich was so tough.

[kalniel]

So if I win the lottery tonight (which I will, despite having no ticket), I've got 6 months to spread my money around?

I don't see that on the list of allowable life circumstances. But if you were to buy a house with the proceeds then sell it, yes.

[SeriousSam]

Sweet. But that's a lot of effort, if you've got say £20m sitting there, you'd need 267 different accounts to keep your money guaranteed. I didn't realise being rich was so tough.

That's why they hire other people to do it... and also why a lot of it doesn't go into banks.

[BobF64]

Sweet. But that's a lot of effort, if you've got say £20m sitting there, you'd need 267 different accounts to keep your money guaranteed.

Not 267 different accounts, 267 different banks, each with their own banking licence.

So, putting money in Halifax and Bank of Scotland counts as 1, because they fall under the same banking institution.

This helps you find out : http://www.moneysavingexpert.com/sav...ngs#whatcounts

Helpfully, the limit is double for a joint account, £75k each.