'£5.6bn cash stashed in UK homes'
More than £5.6 billion in cash is stashed away in the UK's homes, with one in 10 people believing their money is safer there than in a bank, the savings safety net has found.
Excluding the contents of their wallets, people typically keep £218 at home, while around one in 33 people has more than £1,000 squirreled away in their house, the Financial Services Compensation Scheme (FSCS) said.
This hoard, kept tucked under mattresses and in jam jars, is largely unprotected, with even the top insurance policies only covering people for up to around £1,000, the FSCS warned.
The body said the current poor returns on savings, as the Bank of England maintains the base rate at a record low 0.5%, should not put people off placing their money into accounts, where up to £85,000 in savings per person per firm is protected by the FSCS.
It suggested the large sums being kept at home could be attributed to 13% of those questioned believing their money is safer at home than in a bank or building society.
The amount of cash people store at home has generally fallen, with Britons typically keeping just under £282 in the house when a similar study was carried out a year ago.
But the FSCS, which protects people when financial services firms go bust, said the drop could be partly due to squeezed households having less spare cash generally.
Mark Neale, chief executive of the FSCS, said: "In these tough times, no-one can afford to lose any hard-earned cash. It is encouraging that people are keeping less money at home than they did in 2011.
"In part this may be because people have less spare cash than they did 12 months ago, but hopefully it also reflects the fact they recognised it is safest in a bank, building society or credit union which is protected by the FSCS."
The FSCS has paid out £26 billion in compensation and helped more than 4.5 million people since it was set up in 2001.