After 15th October, the old £1 coin will no longer be legal tender. Yet, in the run up to the deadline, the Royal Mint estimates that as many as 1 in 3 UK households may still have some lying around the house, languishing down the back of the sofa, in piggy banks, old purses and coat pockets.
Assuming that each household has just one old Pound coin, that equates to at least £9 million in forgotten cash – and it could easily be far more.
Research from Portafina1 found that on average, Brits claim to have around £20 in loose change hidden around the house, with the most common places being in old purses and wallets (£2.30), gym bags (£1.20), suitcases (£1.50), clothes (£2.34) and their cars (£2.45). Much of this change could be the old-style Pound coins.
So, what would happen if Brits were to rescue these coins and invest them? If each household used just one to start an 'Adventurous' investment plan (our highest-risk plan), they could potentially double their money over ten years2, equating to a possible £18m of extra spending power for the economy. That would pay for:
- More than 5000 summer holidays for a family of four, or
- 750 weddings, or
- Almost 550 house deposits for first time buyers, or
- Fees for 650 undergraduate degrees
You can see then, while the humble £1 coin may not feel like it can make a difference on its own, collectively it could cost the UK economy dearly, if the old ones just disappeared.
What you may not realise is that after 15th October, shops don’t have to accept the old style coins, and some high street banks say they will only accept them from their own customers, so you could find yourself stuck with unwanted coins.
If that happens, the only way to guarantee getting your money exchanged is via the Bank of England in London, which let’s face it, isn’t going to be something people will bother to do.
Moral of the story - don’t dismiss your old pound coins as small change. Raid your money jars, check your sofas and shake out your old jackets to rescue them, and put them to good use before it’s too late!
1 Source: http://www.housebeautiful.co.uk/lifestyle/news/a1702/brits-hiding-money-under-mattress/
2 Predicted values are based on 9 million people, each making a £1 deposit into a high-risk (Adventurous) Wealthify investment Plan for 10 years. Predicted values are for illustrative purposes only and are calculated using ARC benchmark data which comprises data on the past performance of hundreds of comparable private investment plans. Past performance figures are not a reliable indicator of future returns. With investing your capital is at risk and you may get back less than you put in.
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The comments and opinions expressed in this article are the author's own and should not be taken as financial advice from Wealthify.