It's a common belief that money in the bank is the safest place to keep your savings. After all, banks are regulated institutions that are supposed to protect your money. But how much of your money really safe in the bank, especially in times of financial turmoil and uncertainty?
Bank Deposit Insurance Scheme
In the UK, parliament established the Financial Services Compensation Scheme (FSCS) as an independent organisation that can offer compensation if authorised firms, such as banks, fail.
When it comes to keeping your money safe in UK banks and building societies, it's important to understand the limits of protection provided by the Financial Services Compensation Scheme (FSCS).
Currently, the FSCS offers coverage of up to £85,000 of eligible deposits per person, per banking license. So if you have money saved with different banks it’s important to check if they share the same licence as your money will not be protected if they do. So If you have accounts with multiple banks and building societies that share the same license, the total protection amount remains at £85,000.
In the case of joint accounts, the FSCS offers protection of up to £170,000. It's worth noting that the compensation applies to eligible deposits only, so other types of financial products, such as investments or insurance policies, may not be covered.
What should you be doing to protect your wealth?
Diversify Your Portfolio
Spreading your money across different assets and investments is the key to protecting your wealth. This can help you reduce the risk of losing all your money in one asset class or investment.
Is gold one of those assets on your portfolio?
Gold has been a popular store of value and a hedge against inflation for centuries. Unlike paper money or other assets, gold has intrinsic value and cannot be printed or manipulated by governments or central banks.
Gold as a Hedge against inflation
Inflation can erode the purchasing power of your money, so your savings will buy less in the future than they can today. Inflation can be good for borrowers but bad for savers, as the value of their savings can be diminished by inflation.
When inflation rises, the price of gold tends to rise as well, as investors seek a haven for their money. Investing in gold can help protect your savings from the effects of inflation and economic uncertainty.
PHYSICAL asset you own
Gold is a tangible asset, meaning that you can physically hold it in your hand. This can be reassuring for some investors who prefer the idea of having a physical asset rather than an abstract financial product like a cash ISA. At Minted you can choose to store your gold with us in secure vaults or have your gold delivered straight to your door. You own this gold and at any point in time if you wished to have this delivered Minted can deliver this to you via our insured and tracked delivery service provider ( Loomis).
Gold also offers the advantage of not having the same restrictions as other saving options like ISA's. While ISAs have limits on how much you can invest, gold allows you to buy as much as you can afford. Unlike ISAs that offer limited returns, buying gold can provide significant growth in value, making it a popular choice for those looking for an alternative investment.
Did you know if you had bought £20,000 worth of gold 20 years ago the value of your gold would now be worth £155,770.*
If you’re still thinking about buying gold and need some further help. Contact us today and we’ll help you through all the flexible options at Minted.
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