How to check your savings are safe

22 December 2014

A guide to help you make sure your savings are protected.



As a saver, the one question you should always ask is: is my money safe?

The good news is, if your hard-earned cash is squirrelled away in an account with a bank or building society that is UK-regulated, it will be protected under the Financial Services Compensation Scheme. This has been in operation since 2001.

How much of your savings are protected?

The FSCS protects up to £75,000 of savings for each individual in the event their bank, building society or credit union was to fail.

For joint accounts, the figure is £150,000.

Check for banks with shared authorisations

While this £75,000 protection extends to all types of product, including current accounts, easy-access accounts, fixed-rate bonds and individual savings accounts (ISAs), you need to be aware that the limit does not apply to each individual brand name, but only per authorised provider.

With this in mind, you need to check carefully, as some banks share an authorisation. For example, Bank of Scotland shares its licence with Halifax, BM Savings, the AA, Aviva and Saga.

Other firms which have a single owner include National Counties Building Society which shares its licence with the newly-launched Family Building Society. Elsewhere, Lloyds Bank and Cheltenham & Gloucester share an authorisation, as do Clydesdale Bank and Yorkshire Bank.

Protect yourself from identity fraud.

Spread your savings around

The best way to benefit from FSCS protection is by spreading your money around between different providers, as this will ensure that more of your hard-earned cash is protected.

Also note that if you are seeking even greater protection, then you might want to look at National Savings & Investments.

As NS&I is backed by the Government, your savings are 100% secure, no matter how big your balance is.

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Does the FSCS protect all savings?

When shopping around for a home for your savings, be aware that some savings schemes do not come with FSCS protection.

Some foreign banks, such as Triodos, are protected by the company’s home nation deposit scheme, in this case, the Dutch scheme. That said, most other banks do now have their accounts protected by the FSCS.

Further to this, peer-to-peer sites,  such as Zopa and Ratesetter, which cut out the banks by putting people with money to lend in touch with those wanting to borrow, are also not covered by the FSCS scheme.

Instead, most of the sites have their own safeguards in place, such as provision funds, to help keep savers' money safe.

For more information, and to check whether your money is protected, visit the FSCS site at https://protected.fscs.org.uk/.

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The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.