I'm new to all this, so this is probably a stupid question, but I've been reading about sub prime and the economic risks etc. for ages now and wondered at the time what this could mean for money in savings and in bank accounts if the worst happened. If Banks and Building Societies have exposed themselves to US and UK sub prime and things head south, as they currently are, is money in savings accounts and banks accounts at risk? Is there any way to know which institutions have got themselves in deep enough to be at risk? As I've said, maybe a silly question but is it time to start thinking about stuffing the mattress with fivers?

Not a stupid question at all...
I like you am thinking on similar lines, the FSA will back up individuals to the tune of 90% of 30K I think???? if your bank or bs goes bust!
So TIME TO SPREAD IT OUT.
I would avoid the smaller institutions and also indian banks!
I am looking at NS&I

Hi and thanks for the reply.

What worries me is the level of exposure and whether the FSA can really support their promise of protection financially if even just a few institutions were in trouble. I seem to remember reading something on HPC last year (?) about the model for banks to be able to pay back a certain % of investments in one go (I think it was only 3%?) and very few were even close. I wonder what the FSA model is?

I thought about NS&I and I've read about Government Bonds although you have to wonder with the Government in more debt than the rest of the UK put together I believe!

You are one of the very few still able to use logic and connect the dots on this forum. Well done. I am sure you'll do well in the tough times to come.

Thanks for the compliment!

Can I ask where you're putting your money? I don't want investments, just safe places for savings having sold up and started renting some time ago. I've lost confidence that it's safe in the Bank or Building Societies hands.

The FSA compensation scheme is funded by small contributions that each financial institution has to make - it is like an insurance policy. If several banks go bust and the money in the compensation scheme runs out, then there will be no more compensation, unless the government steps in.