More than £5.2 billion in cash is lying around in UK homes, leaving millions of people unprotected by the Financial Services Compensation Scheme (FSCS).
Almost £200 in cash is kept in the average household, not including the money in wallets and purses, according to research out today from the FSCS, though the figure is down from more than £280 two years ago.
Many people have more than £1,000 in their home, it found, even though the average home insurance policy only covers up to £1,000 in cash.
The FSCS covers up to £85,000 deposited in an authorised institution in the event of it going bust. When that happens, most people get their money back within seven working days, meaning there’s no need to keep it under the mattress. The FSCS has paid out some £26bn to more than 4.5 million people since 2001.
Mark Neale, chief executive of FSCS, said: “People should remember that FSCS protects any cash up to £85,000 in an FSA-authorised institution. By contrast, any money which is kept at home may not be covered by household insurance. In these tough times no one can afford to lose their hard-earned cash.”