Risk-free investingGovernment safety net
The Government now has robust plans in place to protect your savings
In case of emergency
For many, the Northern Rock situation has shaken confidence that there is any such thing as risk free saving. Thankfully, there’s no need to panic and the government has also stepped in to allay fears further.
To find out more check our report on the credit crunch, as well as the Northern Rock website.
Strictly speaking, saving with government backed institutions such as National Savings & Investments (NS&I) is safer than if you save with building societies and banks. Although in the UK, banks are authorised by the Financial Services Authority (FSA) and covered by the Financial Services Compensation Scheme (FSCS).
Indeed the FSA has recently increased the limit of the FSCS so that it covers the first £35,000 of an individual’s savings.
Sums above this are not covered by the scheme, so risk-averse savers with more to invest should consider using different institutions to limit their exposure.
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