£10,000 Bank Account Warning: How Much Cash You Should Really Keep in Your Current Account in 2025

As of 30 November 2025, UK banks and regulators are sending a clear message: if you’re sitting on £10,000 or more in a current account, you’re probably losing money in real terms.

Fresh data from savings app Spring and new warnings from financial experts show that millions of Britons are leaving “dead money” in zero‑interest current accounts, just as inflation and rule changes on savings and ISAs reshape the landscape. ^[1]

At the same time, the deposit protection limit is about to rise and cash ISA rules are set to tighten, making this a pivotal moment to rethink where you park your cash. ^[2]

A fresh warning for anyone with £10,000 in the bank

On 29 November 2025, GB News highlighted research showing that 6.4 million UK current accounts hold at least £10,000, with around 323,000 accounts holding £100,000 or more – and many of these balances earn no interest at all. ^[3]

The analysis, based on data compiled for Spring, shows:

Millions of people are effectively donating hundreds of pounds a year to their bank by not moving surplus cash into savings.
With easy‑access savings paying around 4% interest, shifting £10,000 from a zero‑interest current account could earn roughly £400 a year instead of nothing. ^[4]

Financial commentator Andrew Hagger (MoneyComms), quoted in that coverage, warns that keeping “a few thousand” permanently in your current account once bills are paid is simply “dead money” – great for your bank, not so great for you. ^[5]

The scale of the problem: millions of “current account coasters”

Spring has put a label on this behaviour: “current account coasting” – leaving spare cash sitting in your main account month after month. ^[6]

Recent research and press releases linked to the app show:

Around 74–75 million UK current accounts in credit earn no interest at all. ^[7]
6.4 million of those accounts have £10,000+ sitting in them. ^[8]
A wider analysis from Spring finds 8.3 million current accounts with balances of £10,000 or more, holding a combined £284 billion, and around 80% of those big‑balance accounts pay zero interest. ^[9]

Spring’s head of money, Derek Sprawling, has been blunt: most people only need a small working balance for day‑to‑day spending. The current account should be treated like a digital wallet, not a long‑term savings pot. ^[10]

How inflation quietly erodes your savings

The other villain in this story is inflation.

Official figures show UK CPI inflation at 3.6% in the year to October 2025, down slightly from 3.8% – but still nearly double the Bank of England’s 2% target. ^[11]
The Office for Budget Responsibility now expects inflation to average around 3.5% in 2025, easing to 2.5% in 2026 and only getting back to 2% in 2027. ^[12]

That matters because any cash earning less than inflation is losing value in real terms:

With inflation at roughly 3.6–3.8%, £10,000 left in a 0% current account effectively loses about £360–£380 of purchasing power in a year. ^[13]
SSBCrack’s 30 November finance piece, based on Spring’s numbers, notes that only around 0.04% of current accounts currently pay an inflation‑beating rate – meaning almost everyone’s everyday account is going backwards in real terms. ^[14]

Put simply: if your current account pays 0% and inflation is 3–4%, your money is quietly shrinking even if the number on the screen stays the same.

How much cash should you keep in a current account?

Different experts phrase it slightly differently, but the emerging 2025 consensus looks like this:

1. Everyday spending + a small buffer

Derek Sprawling suggests keeping roughly £500–£1,000 in your current account for day‑to‑day spending, bills and emergencies, treating it like a wallet rather than a savings pot. ^[15]
GB News quotes advisers saying around £1,000 for bills and direct debits is enough for many people, with the rest moved into savings. ^[16]

If your income is irregular or your bills are high, your comfort level may be more like one month’s essential outgoings rather than a fixed number. But the principle is the same: only keep what you realistically expect to spend soon.

2. Anything more is likely “dead money”

If, after payday and bills, you consistently have:

£3,000–£5,000+ just sitting there, or
a permanent £10,000+ cushion you don’t plan to spend

…then, in the current rate and inflation environment, that’s almost certainly too much to leave in a 0% current account.

Where to move extra cash: easy‑access savings, ISAs and more

The good news: as of late November 2025, savings rates are still relatively generous compared with the last decade – if you’re willing to move your money.

Easy‑access savings: solid rates and instant-ish access

Recent round‑ups from MoneyWeek and other comparison sites show: ^[17]

The top easy‑access savings accounts pay around 4.4%–4.5% AER, sometimes slightly higher for larger deposits or promotional deals.
Several high‑street banks, however, still offer well under 2%, with some easy‑access accounts and legacy products paying below 1% and even as low as 0.2%. ^[18]

So if you’ve left money where your bank first put it, there’s a good chance your rate is far below what’s available elsewhere.

Even a modest move makes a real difference:

At 4% AER, £10,000 earns about £400 a year before tax.
At 0.5%, that same £10,000 earns just £50.

(That’s a difference of £350 every year, for doing little more than filling in an online form.)

Cash ISAs: tax‑free interest – but big rule changes ahead

For now, you can still put up to £20,000 a year into ISAs, and top easy‑access cash ISAs are paying around 4.4–4.5% AER, similar to the best taxable savings. ^[19]

However, the Autumn Budget 2025 confirmed a major change:

From April 2027, if you’re under 65, you’ll only be able to put £12,000 per year into cash ISAs.
The overall £20,000 ISA allowance remains, but the remaining £8,000 will have to go into stocks & shares or other investment ISAs if you want to use the full tax‑free limit.
Over‑65s keep the full £20,000 cash ISA allowance. ^[20]

HMRC has also signalled it will penalise people who try to park large amounts of cash inside stocks & shares ISAs to dodge the lower cash limit. ^[21]

What this means:
If you’re under 65 and have, or expect to have, £10,000+ in savings, the next 16 months are a valuable window to maximise tax‑free cash savings under the current, more generous rules.

How safe is your money? Deposit protection is rising to £120,000

Another big change kicks in tomorrow:

From 1 December 2025, the Financial Services Compensation Scheme (FSCS) will increase its deposit guarantee from £85,000 to £120,000 per person, per authorised firm. ^[22]
Temporary high balances (for example from a house sale or inheritance) will also see their protection limit rise from £1 million to £1.4 million for up to six months. ^[23]

This matters if:

You have more than £85,000 in cash right now with a single bank or building society; or
You’re thinking of moving a large sum out of investments or property and into cash.

From tomorrow, more of that money will be protected in each individual institution, reducing the need to split deposits quite as aggressively as before. But if you hold very large sums, it can still make sense to spread your cash across multiple FSCS‑protected providers.

(Always check whether brands share a banking licence – some “different” banks sit under the same legal entity.)

Simple action plan for 30 November 2025

Here’s a practical, non‑scary checklist you can work through in an evening. This is general information, not personal financial advice – but it should help you ask the right questions.

1. Audit your balances

List all your current accounts and easy‑access savings.
Note the balance and the interest rate on each (you’ll usually find this in the app or on a statement).
Circle any current account with a permanent balance above your normal monthly spending.

2. Pick your current‑account buffer

Ask yourself:

What’s my average monthly spend on bills and essentials?
Do I feel safer with one month of expenses in my current account, or a flat figure like £1,000–£1,500?

Set a target buffer that feels realistic but not excessive. For many people, that falls somewhere in the £500–£1,500 range, depending on income and volatility. ^[24]

3. Move the extra to a high‑interest account

Use a reputable comparison site or your bank’s marketplace to find easy‑access accounts paying around 4–4.5%. ^[25]
Consider whether you want:
- A standard easy‑access savings account;
- A cash ISA (for tax‑free interest, bearing in mind the 2027 rule change); or
- A linked app such as Spring that sits alongside your current account and lets you sweep money back and forth quickly. ^[26]

Even if you only move half of a £10,000 balance, you’re still transforming truly “dead” money into something that at least keeps pace with or beats inflation.

4. Check your FSCS coverage

If your total cash with a single bank or building society is under £120,000, you’ll be within the new FSCS limit from 1 December 2025. ^[27]
If you’re above that, consider spreading your savings across more than one UK‑authorised firm.

5. Set a regular “cash MOT”

Experts like Derek Sprawling suggest doing a weekly or monthly review of your current account:

Skim off any surplus above your chosen buffer into savings.
Review whether your savings rate is still competitive – banks quietly cut rates all the time. ^[28]

Five minutes once a month is enough to keep you out of “current account coaster” territory.

Common myths that keep money stuck in current accounts

“I might need the money – I can’t lock it away.”

You don’t have to. Easy‑access savings and many app‑based accounts allow same‑day or next‑day transfers back to your current account, with no penalties. ^[29]

“It’s not worth moving – I don’t have that much.”

Even at relatively small levels, the difference adds up:

£4,000 at 4% earns £160 a year before tax.
£7,000 at 4% earns £280. ^[30]

That’s a couple of months’ energy bills or a serious dent in the weekly shop.

“My bank would tell me if I was losing out.”

The FCA’s Financial Lives survey shows that many people have poor financial resilience and significant cash sitting in low‑return accounts, despite banks and regulators knowing better options exist. ^[31]

Banks aren’t obliged to move you to their best rate automatically, and older “legacy” accounts are often the very worst performers.

Quick FAQ

Is it ever sensible to keep £10,000 in a current account?

Yes, but only in specific situations – for example:

You’re in the middle of a house purchase or large planned expense in the next few weeks.
You’re temporarily holding a large payout and haven’t yet opened a suitable savings account.

For anything medium‑term (months or years), parking £10,000 in a 0% current account while inflation runs above 3% is almost always a poor deal.

Are all savings accounts covered by FSCS?

Most mainstream UK banks and building societies are, but always check:

Look for the “FSCS Protected” badge or check the firm on the FSCS website.
From 1 December 2025, the limit is £120,000 per person, per authorised firm for qualifying deposits. ^[32]

Some fintech or app‑based accounts use partner banks; in that case, your protection sits with the underlying bank(s), not the app itself.

What about overpaying my mortgage instead of saving?

That’s a separate decision:

If your mortgage rate is higher than the best savings rate after tax, overpaying can be attractive.
But you lose liquidity – once money is in the mortgage, it can be hard or impossible to get back without refinancing.

Most people will want both a proper cash emergency fund and a plan for debt repayment. That balance is personal and may warrant tailored advice from a regulated adviser.

Is this personal financial advice?

No. This article is general information only and doesn’t take into account your individual circumstances, debts, tax position or risk tolerance. Before making big moves with large sums, or combining decisions about savings, investments and mortgages, consider speaking to a regulated financial adviser.

Bottom line

On 30 November 2025, the picture is clear:

Millions have far too much money languishing in zero‑interest current accounts.
Inflation above 3% means those balances are shrinking in real terms.
Easy‑access savings and cash ISAs are still paying around 4–4.5%, and from tomorrow your deposits will be better protected up to £120,000 per institution. ^[33]
New ISA rules from 2027 will make it harder to shelter large cash balances tax‑free if you’re under 65.

If you’re one of the millions with £10,000+ sitting in your current account, this is a good day to log in, decide your “true” buffer, and put the rest to work.

Why I left banks and high-yield savings accounts for the Fidelity Cash Management Account