SAYE savings are protected

Thursday, 30 October 2008 04:03

The UK's 2.3 million Save As You Earn share plans are protected just as savings accounts are protected, it was ruled today.

The Financial Services Compensation Scheme (FSCS) today stated: "Money deposited via a SAYE scheme that is run in the standard way will be protected in the same circumstances as any other deposit will be."

The scheme added protection stood whether the scheme holds the deposit in individual accounts for each employee, or in one common scheme account.

However, it was noted any SAYE amount deposited with a bank or building society counted towards the £50,000 compensation limit with that bank or building society, if it failed.

Phil Hall, head of ifs ProShare, which promotes employee share ownership, said: "Whilst it was always our belief that such savings were protected, it is very helpful indeed to have this clarification.

"Employees can now have absolute certainty that their SAYE plan savings are protected."

Under SAYE schemes between £5 and £200 a month can be saved over a three, five or seven year period. After these periods an employee can buy shares in their employer with the money saved or have their savings returned with a cash bonus.

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