This section is from the "Everybody's Guide to Money Matters" book, by William Cotton. With a description of the various investments chiefly dealt in on the stock exchange, and the mode of dealing therein. Some account of the pitfalls prepared for the unwary, and suggestions to the cautious investor.
This institution offers a most admirable, convenient, and secure depository for the savings of the industrial classes and of others. Its value to the thrifty and timid investor is incalculable, for here he may rest satisfied that he has absolute security, and the system is so hedged about with safeguards that it is difficult to discover any means by which loss can be sustained. The interest allowed is not high, but reasonable enough when the perfect security and the facilities offered are taken into consideration.
Money may be deposited by any person over seven years of age, and by anyone on behalf of children under seven. Also by married women, and with this advantage, that such deposits, unless and until the contrary is proved, are deemed to be the property of such married woman; moreover, the fact that any deposit is standing in the name of a married woman being "prima facie" evidence that she is entitled to draw the same without the consent of her husband.
Deposits may be made by two or more persons, provided no one of them has any other account in a Savings Bank, and by one person as trustee for another person. On opening an account a person has to sign a declaration to the effect that he takes no personal benefit from any other account in the Post Office Savings Bank or in a Trustee Savings Bank, and should this declaration not be true all sums so deposited will be liable to forfeiture.
Any person opening an account, that is, depositing money with a Post Office Savings Bank, will receive a book in which the amount is entered, and the signature of the Postmaster and stamp of the office affixed to the entry. In addition to this he will receive from the department in London, a few days after, a receipt for the amount. Once in each year, on the anniversary of the day on which his first deposit was made, the depositor should forward his book to the Controller of Savings Banks, London, in order that it may be compared with the books of the department in London, and that the interest may be inserted in it. A depositor may add to his deposits at, and withdraw the whole or any part of them from, any Post Office in the United Kingdom without change of depositbook. It will thus be obvious that all deposit accounts, although operated upon through the branch post office, are really kept at the Savings Bank Department in London, and depositors are so kept in touch with the department that complete protection is afforded them.
Any sum from one shilling upwards (but excluding pence) may be deposited, subject to certain limits. These limits are £50 a year, that is, no more than £50 will be received on deposit in any one year, but any withdrawals during the year may be re-deposited once, and once only. No more than £200 in all can be held on behalf of a depositor. The reason for these limits apparently is that the bank was created for the encouragement of saving habits in, and providing a secure place for, the money of thrifty people of small means, and not for investment of the capital of the wealthy. Interest at £2 10s. per cent. per annum, which is at the rate of sixpence a year, or one halfpenny a month, for each complete pound, is allowed on ordinary deposits and added to the principal; but when, by the addition of interest or from any other cause, the deposit is raised to above £200, interest is allowed on £200 only, and the excess over that sum, when it amounts to £5, is applied to the purchase of Government Stock, unless the depositor desires otherwise. When a person has £200 to the credit of his deposit account, he cannot make any further addition thereto, but the Post Office will invest this sum, or any part of it, for the depositor in Government Stock, and he can then continue paying in money to his account as before until the sum again reaches £200. No more than £200 Government Stock can be purchased in any one year, and the total amount of stock standing in a depositor's account at any one time must not exceed £500. The dividends or interest on any Government Stock is credited periodically to the holder's ordinary deposit account. When a depositor wishes to withdraw the whole or any part of his money, he has to fill up and forward to the Savings Bank Department in London, a notice of withdrawal, and a form for the purpose may be obtained at any Post Office Savings Bank. He will then receive by post a warrant, on presentation of which, at any branch Post Office he may have selected, payment will be made. Payment by a warrant may be made to another person on behalf of the depositor, provided the latter signs a form of authority for the purpose, which form may be obtained at any Post Office Savings Bank.
A depositor of the age of sixteen and upwards may nominate any person to receive any sum (not exceeding £100) due to such depositor at his death. Every nomination must be in writing on the proper form, which may be obtained from the Controller of the Savings Bank Department, in London, to whom the nomination must be sent during the depositor's life-time.
Where, at the time of the depositor's death, the amount standing to his credit exceeds £100, it will be necessary, in order to obtain payment, that probate of his will, if any, or letters of administration (if he has died intestate), should be obtained in the usual manner.
Where the whole amount standing to the credit of a depositor at the time of his death, inclusive of Government Stock, does not exceed £100, in default of a nomination, or probate, or letters of administration, payment may be made:
To any person who has paid the funeral
expenses of the depositor;
To creditors of the depositor;
To the widow or widower of the depositor;
To the persons entitled to the effects of the deceased according to the Statute of Distribution.
To any other person establishing, to the satisfaction of the Postmaster General, a claim in accordance with the Statutes and Regulations relating to the Post Office Savings Bank.
The salient points of the Post Office Savings Bank have been placed before the reader, but in connection with the system there is another organization, for the purpose of purchasing Government Annuities and effecting Life Insurance, of so varied and elaborate a character that every possible requirement seems to be provided for. The "Post Office Guide," which is published quarterly, contains voluminous tables and explanations in respect of this organization, and full details and clear directions for the guidance of the public in regard to the Savings Bank.
The growing success which attends these several institutions is an unmistakable indication of the value set upon them by the people. The prudent and thrifty have not been slow to take advantage of the benefits they offer, not the least of which are the freedom from doubt and anxiety they enjoy as to the safety of their money, and the certainty felt that, though other concerns may fall and involve their victims in ruin, here there is absolute and permanent security.