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27/02/12
One in 10 people feel their money is safer at home

More than 5.6 billion worth of cash is being stashed away in homes across the UK, according to the body which provides protection for savers when banks fail.

The Financial Services Compensation Scheme suggests one in 10 people feel their money is safer at home than in an account - However, the Financial Services Compensation Scheme has warned money stored away at home is largely unprotected, with even the top insurance policies only covering people for up to around 1,000.

For depositors, the past four years have been tumultuous. Back in 2008, British savers could choose from dozens of banks and financial institutions from all over the world. But the financial crisis changed that when many foreign banks folded, especially from Ireland, America and Iceland.

At the same time, the money earned for your savings crashed as interest rates fell from almost 6% to their current 0.5%. It led to millions of British savers out of pocket and worrying for the first time in generations about whether their money would be safe in a bank and it looks as if that fear hasn't disappeared; the Financial Services Compensation Scheme reckons that there's around 5.6 billion under the proverbial mattress at home.

In an interview with the BBC Simon Rose, from Save Our Savers said: "It's only five years since we saw the first bank run in 150 years. The Bank of England is printing more money all the time - 325 billion - which is bound to lead to inflation. Maybe people aren't so mad, I've met some quite sane people who just don't trust money anymore. They think if the bank is going to keep printing it we've got to find something else to store our assets."

Savers are also reminded that in the current high inflation environment keeping your money in a jam jar instead of a bank makes even less sense. At least though the number of people doing that was down on the same time last year.