From January, cash in bank accounts will only be guaranteed by the Financial Services Compensation Scheme (FSCS) up to a limit of £75,000 down from the current limit of £85,000. This figure is per person, so the guarantee on a joint account will fall from £170,000 to £150,000.

This level of protection is fixed across the EU at EUR 100,000 by a European Directive and is reviewed every five years. When the former level was agreed in 2010, that figure translated to £85,000 but as the euro has fallen against the pound, it now equates to just £75,000.

Remember that the £75,000 protection limit applies to each banking licence rather than each bank and some of the main players are all owned by the same group following a series of mergers and acquisitions. Those with funds above the new limit may wish to split the sum across several separate institutions as soon as possible.

One positive change announced by the PRA (the Prudential Regulation Authority, part of the Bank of England which governs banking institutions) is that savers who deposit high balances temporarily – such as funds from property sales or inheritance – will be covered for up to £1million for six months after the funds reach the account.

Is your nest egg safe? Are you confident that you are making the most of opportunities for savings and investments? For more information, please contact one of our advisers on 020 7636 7006.