Up next in 10
How Good are ONLINE BANKS and are they GUARANTEED | Christina Brady on BayRadio
1K views
Oct 29, 2024
Spanish residents are legally entitled to open a simple bank account, but difficulties elsewhere mean many are turning to online only banks. How safe are these and is your money guaranteed in case of their collapse? Christina Brady from @blacktowerfinancialmanagem7049 addressed this subject and more during her regular appearance with Moody this week. For any enquiries contact info@blacktowerfm FAO Christina or get in touch through the website: www.blacktowerfm.com Be sure to Like and Subscribe to our YouTube channel for more insights from BayRadio Spain, and follow us on Social Media: Website: http://www.bayradio.fm/ Facebook: https://www.facebook.com/BayRadioInSpain Instagram: https://www.instagram.com/bayradiospain/
View Video Transcript
0:00
we specialize in protecting preserving
0:02
and growing your wealth Black Tower
0:04
financial management the team you want
0:06
by your side visit black toow fm.com
0:09
talking to Christina Brady from
0:11
blacktower at financial management every
0:13
other Tuesday unless we tell you
0:14
otherwise and we're talking about banks
0:16
in just a moment here but um I always
0:18
say we start with the sort of global
0:19
picture and then bring it down to your
0:20
personal finance bits and Bobs including
0:22
pensions something you just wanted to
0:24
mention quickly yeah the UK government
0:27
has got to decide soon about what to do
0:29
about the triple BL on state
0:31
pensions and specifically what raise the
0:35
state pensions should get each year now
0:38
usually it's calculated in the three
0:40
months from May to July and if you look
0:43
at that uh the earnings component
0:45
because earnings have gone up was
0:46
increased by
0:48
8.5% but what they're saying is that
0:50
during that time there was one-off
0:52
payments to NHS staff and civil servants
0:55
which made that figure Spike and made it
0:58
higher than it should have been so what
1:00
they're saying is that they may change
1:03
that and they may make it so rather than
1:06
it being you know earnings component
1:08
they're going to use the regular growth
1:10
in the three months to July which would
1:13
mean pensions would only go up by 7.9%
1:16
next year rather than
1:17
8.5 which would save the UK ex cheer
1:20
about I think 1 billion um so I think
1:23
it's safe to say that this option is
1:25
under consideration by the UK government
1:27
they're always looking at ways to reduce
1:29
the amount they have to pay in State uh
1:31
pensions and this is one way they could
1:34
do it they could say look this figure
1:36
was artificially High because of these
1:39
one-off payments if we strip those out
1:42
and we just look at regular growth
1:43
you're going to be getting over half a
1:45
percent less at 7.9 so that should be
1:47
announced soon um so let's wait and see
1:50
but if they can get away with it I think
1:53
you know they would no matter what
1:54
government's in power would do the same
1:56
because they need to save money
1:58
unfortunately that's at the expense of
2:01
pensioners I know you got a nice large
2:03
rise last year but that still wasn't uh
2:05
as much as inflation on core things like
2:08
energy and food and we were hoping that
2:11
this year you'd get at least 8.5 now it
2:13
looks like it could be 7.9 which maybe
2:16
doesn't sound like a lot but you know it
2:19
is to some people it can make a
2:21
difference so just to let you know that
2:23
that's up for discussion at the moment
2:24
that was just something I thought I
2:25
needed to mention yeah just a reminder
2:27
for people well people like me uh triple
2:30
lock it's it's still in place and what
2:32
what does it involves you get the
2:33
highest rate of three different you get
2:35
the highest rate you get you get 2.5 or
2:38
the higher of CPI or wages growth right
2:42
there we go that's it I I new two two
2:44
out three so at the moment obviously
2:46
wages growth was higher so that's the
2:48
figure that would be taken and if we get
2:50
on to Banks then we were talking about
2:52
investing um you know maybe a large sum
2:55
but you always say keep a little bit
2:56
back to play with you know just for cash
2:58
transactions and not just to play with
2:59
but for a contingency fund so say your
3:02
car needs work on it or you know some
3:05
people need a knee replacement and have
3:07
to wait in Spain it's not that bad but
3:09
say you had to wait months and you
3:10
wanted it done soon you could pay or
3:11
you've got something wrong with your
3:13
eyes I you know like cataracts and you
3:15
want that sort of it's or you just need
3:16
to go and visit family you've always got
3:18
to have some money behind as a
3:20
contingency fund but the rest of it
3:22
should be actively working for you if at
3:24
all possible okay and as far as Banks go
3:27
where are we at then because it's we I
3:29
get the sort of impression it's just
3:31
really hard to open a new account these
3:33
days I'm sure it's not Cas in Spain
3:34
everyone has to have everyone has the
3:36
right to open a bank account so in Spain
3:39
but in the UK as we know that is not the
3:42
case and if you are a certain person or
3:45
people and you've upet certain people
3:47
your both bank account could be closed
3:49
or you cannot open a bank account but in
3:51
Spain under law everyone can apply for a
3:54
bank account but at the moment we've
3:55
seen you know the rise of online banks
3:58
so I think the main ones I hear about
4:01
are wise revolute and
4:04
n26 um and people come to me and say oh
4:08
and there is a huge difference between
4:10
them I think why is people forget it is
4:12
not a bank okay because someone came in
4:15
today and said oh W wise is offer me 3
4:17
point something on my deposits I said
4:20
yeah but that's linked to a fund run by
4:21
Black Rock and also wise is not a bank
4:24
so it's not covered by the fs fscs
4:27
protection by banking protection okay um
4:30
what it does is it invests your money in
4:32
lowrisk liquid assets so money market
4:35
funds run by Black Rock and State Street
4:38
um you know it's based in Estonia and
4:41
Estonia does a guarantee up to
4:44
50,000 Euro 20 sorry, EUR if you're are
4:47
based in Europe if you're in the UK you
4:50
are not uh covered and some people some
4:53
came to me and said oh I've got a wise
4:55
account because they don't report it to
4:56
anyone so I can keep my money there and
4:58
it doesn't come down to this this
4:59
International reporting thing where all
5:01
the banks report that is wrong okay it
5:04
reports to the tax Authority in the EU
5:08
and the UK If you have an account so
5:11
what it does is it reports it to the
5:13
central bank in Estonia and they report
5:15
it on to authorities in the EU and the
5:17
UK if they are asked to so it is not
5:20
under the radar it is not somewhere
5:22
where you can stash money that you
5:23
haven't declared and they'll never find
5:25
out all banks all online um investment
5:29
comp is anything pensions all agreed uh
5:33
to CRM which is the which is colum
5:36
reporting of all assets held by people
5:40
outside their country of residence and
5:42
that was agreed to years ago and it is
5:46
reported by the central banks in a data
5:48
dump to the various authorities every
5:51
year it's up to the authorities where
5:53
they act on that but it does happen so
5:55
that's why it's not you know officially
5:58
a bank then you've got revolute
6:00
which is out of
6:01
Lithuania um and that again doesn't
6:04
report directly to the EU and UK it
6:06
reports all accounts to the tax
6:08
authorities in Lithuania and they are
6:10
then responsible for sending this
6:12
information to other countries for tax
6:14
purposes under the automatic exchange of
6:17
financial information act um this is
6:20
protected in the EU and it's regulated
6:23
as a bank so it's guaranteed up to
6:25
100,000 um by the bank of Lithuania okay
6:30
and in the UK by the
6:32
fscs so that is something you know
6:35
you've got to remember there is a
6:36
difference there and then you have uh
6:39
n26 that's German um so it's a German
6:42
Bank operating in Spain again that's
6:45
guaranteed up to
6:46
£100,000 and that's under the EU scheme
6:49
so that's guaranteed by the DU German
6:51
deposit scheme obviously Revue is
6:53
guaranteed by the Lithuanian deposit
6:55
scheme of the two obviously Germany is
6:58
seen as being more robust um but you
7:01
know that at least they're both
7:03
regulated and they are both of you some
7:07
form of protection if anything does
7:09
happen also I come across a lot of
7:11
people that have accounts or investments
7:13
in the aisle of man now the a of man
7:16
people think is part of the UK uh
7:18
banking system it's not it's got its own
7:21
separate rules okay so if you have an is
7:23
of man account that is only guaranteed
7:26
to 50,000 per person whereas in the UK
7:28
If you have a bank account it's 80 I
7:31
think it's now
7:33
85,000 and it's 100,000 per couple and
7:36
that is guaranteed by the uh is of man
7:38
Compensation Board so there are
7:40
differences and I think people need to
7:42
remember that um and all these banks are
7:46
signed up to the automatic exchange of
7:48
financial information act and that means
7:51
that they report their uh positions for
7:54
people who are non-residents to the
7:56
central bank uh wherever they're based
7:58
and they that's Central Bank can then uh
8:01
report that to say Spain France wherever
8:05
you know these accounts are held and
8:06
then it's up to those countries as to
8:08
what they do with that banking
8:09
information that comes through so at the
8:12
moment in the olden days it was very
8:14
easy to have a bank account and stay
8:16
under the radar nowadays not it's near
8:19
night impossible unless you go to a few
8:22
very obscure countries in the world
8:24
where personally I wouldn't be putting
8:26
my money anyway right um you saw what
8:28
happened with Panama you know all these
8:30
rich people thought they could get away
8:31
with it you had one whistleblower it all
8:33
came out happened to HSBC happened to
8:36
credit SS um and I think you've got to
8:39
remember that and people who thinks a
8:41
cashless Society is a good idea should
8:42
think again because once there's a
8:44
cashless Society if you upset any of
8:47
these authorities you will be able to
8:48
you will find that you will not be able
8:50
to access your money in any bank account
8:52
anywhere in the world um at least now if
8:55
you have cash you have a backup say if a
8:56
banking system goes down or if for some
8:59
reason you are black blacklisted you
9:01
have cash that you can still go out and
9:03
buy things if that changes that will not
9:05
be possible we've got certain instances
9:07
in China where this has happened and
9:09
basically people have been left to
9:10
starve um cannot travel cannot get jobs
9:13
cannot do anything because it's all
9:16
electronically controlled so you know
9:18
when you see this oh cashless is best
9:20
it's best for the authorities because
9:22
then you cannot do anything without them
9:24
knowing they will know exactly what your
9:26
tax position is they will know exactly
9:28
what you're spending your m money on so
9:29
if you spend your money on a luxury car
9:32
and that isn't that they look at it and
9:34
they think well you've only got a job as
9:35
this how can you afford that right they
9:37
can come down on you on a ton of bricks
9:39
so I think people need to push for cash
9:42
um and to use cash more but as I said be
9:45
very wary when you are going on to the
9:47
online banks make sure that they fulfill
9:49
the needs you you want um and as I said
9:53
some of them are offering interest on
9:55
their accounts but you've got to
9:56
remember that isn't a guaranteed fixed
9:58
interest rate
9:59
okay that is invested in lowrisk liquid
10:02
assets and at the moment money market
10:04
funds are doing well because interest
10:06
rates are high once interest rates fall
10:09
the rate they're going to offer is going
10:10
to fall substantially as well so you may
10:12
go back to getting nothing on those
10:14
accounts okay it's not guaranteed so
10:17
just be aware of that when you invest in
10:19
the or put your money in these places
10:21
yeah interesting to know because they're
10:22
doing very well n26 and revolute I think
10:25
are kind of neck and neck as far as
10:27
popularity goes but good to know from
10:29
yourself that they you've got that sort
10:30
of uh coverage and um security as it
10:33
were with the uh yeah you do need that
10:36
security because you know we all banking
10:38
Leman brothers too large to fall it fell
10:40
you know um Morgan Stanley was on the
10:43
verge of failing if the American
10:45
government haven't bailed it out
10:46
secretly so no bank is Big too big to
10:49
fall I think that's what you've got to
10:51
remember therefore you need to make sure
10:53
that you have certain guarantees with
10:55
your account um and certain protection
10:58
for your money yeah and there are you
11:00
can put cash into those accounts um at
11:03
the ATM yeah yes you can you can feed it
11:05
in at an ATM being transfer it from
11:08
another bank account but no I think
11:10
that's something that people you know
11:11
you do need to take into consideration
11:13
as I always say to people it's your
11:14
money you have got some responsibility
11:17
for making sure it is as safe as it can
11:19
be and it's invested in a way that meets
11:23
your needs now people what people want
11:25
and PE what people need are two
11:27
completely different things you know
11:29
everyone would would Wants To Be A
11:31
Millionaire but everyone needs just
11:33
enough money to be able to live so
11:34
you've got to marry those two together
11:36
and obviously there's got to be some
11:38
compromise um not everyone can become a
11:40
millionaire overnight but again as I
11:42
said your it's your money you most
11:44
people work very hard for it if you've
11:46
inherited it your family have worked
11:47
very hard for it therefore make sure
11:50
it's put to the best use possible
11:51
listening and exceeding expectations for
11:54
over 31 years Black Tower financial
11:57
management the team you want by your
11:59
side visit blacktower fm.com
#Banking
#Business News
#Financial Planning & Management
#Retirement & Pension
#Savings Accounts