Farewell to last of our paper money
THE days of the old paper £20 and £50 notes are numbered as they will be withdrawn from circulation on September 30.
So it’s time to start checking under your mattress, in old money boxes and all those pockets and zippers of wallets, purses and handbags, to ensure you haven’t got any tucked away.
The notes have been replaced by the tougher new polymer versions, which can withstand a spin in the washing machine, but which lots of people find more difficult to handle.
After September 30 you can’t spend the old notes in shops, although you’ll still be able to pay them into your bank and at the Post Office.
The Bank of England can also exchange notes for you. You’ll need to make sure you complete the right forms and have proof of your ID and address.
Go to bankofengland.co.uk and search for ‘exchanging old banknotes’ on the website or you can call 0203 461 5994.
If you want to exchange by post you’ll have to send the money along with photocopies of your ID and the forms to Department NEX, Bank of England, Threadneedle Street, London EC2R 8AH.
The Bank of England can send you a cheque, pay the money into your bank account, or send you new notes – as long as you’re not exchanging more than £300.
Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, says:. “These paper notes have been with us a while. The first £20 notes were introduced in 1725, handwritten on one side and issued to individuals as needed.
“In 1943 production ceased, but then in
1970 two-sided versions with an image of Queen Elizabeth II were introduced. The last version of the paper £20 was introduced in 2007.
The first £50 notes arrived in 1725 too, also handwritten and issued as needed. The Bank of England also ended production of them in 1943 and they did not reappear until 1981, when the first colour £50 note arrived. The last paper version was introduced in November, 2011.”
THE £20 NOTE 10 ways life has changed since the last paper £20 was released
■ Back in March 2007, we were enjoying the last months of boom before the global financial crisis. Nobody expected a run on Northern Rock bank just six months later.
■ Interest rates were at 5.25% and reached a peak of 5.75% in July, before the crisis provoked a run of cuts to record lows.
Now they’re only back up to 2.25% and are expected to peak below 5% next year.
■ In March 2007, the average house cost £178,636. It’s now £292,118. That’s up an eye-watering 64%.
■ Back then house prices were rising at 3.6%. Now figures from July make that 15.5%.
■ In 2007, women’s state pension age was 60 and for men it was 65. Now it’s 66 for both.
■ A pint of milk cost 37p in 2007. Now it’s 62p.
■ Back then Woolworths was still on the high street, as was Mothercare, BHS and Debenhams.
■ MP3 players and Sat Navs were popular enough to make it to the Office for National Statistics basket of goods.
■ In 2007, olive oil was only just considered a popular enough staple to make it to the inflation basket.
■ Back then, the UK population was 61.3 million, it has grown by more than six million – to 67.4 million (2021).
THE £50 NOTE Five things you could have done with a £50 since its reintroduction in 1981
■ £50 in 1981 had the spending power of £248 today.
■ If you’d have left it under the mattress since 1981, you’d still only have £50.
■ Saving a £50 note in 1981, with an average 3.5% a year interest, would give you £210 today.
■ Invested in the FTSE All share index on the day of launch in 1981, your investment would be worth £2,457 today.
■ If you’d invested £50 a month since 1981, you’d have an impressive nest egg of £209,825.
However the £50 could soon be gone altogether. In 2018 the Government launched a consultation on whether they should axe the note. Eventually they decided to stick with it, but plenty of the arguments still apply, and have only got stronger as we use cash for fewer and fewer transactions.
Sarah Coles adds: ”The problem is nobody really spends the £50 notes. A 2013 survey found 29% of people had never used one.
“There were 330 million in circulation – with a combined value of £16.5 billion, but they’re largely used as a store of value – which isn’t very efficient.
“The Government was also concerned that criminals find them particularly useful.”
In spite of this, the £50 could be protected by the fact that sticking with it is cheaper than axing it.
The note accounts for 24% of Bank of England notes in circulation by value.
The Bank has pointed out that if they got rid of them they’d have to produce a lot more £20 notes to make up for them, which would be expensive.
And then of course, the faster inflation rises, the stronger the argument becomes for keeping the £50 note. At this rate it could end up being smaller denominations that get the boot.
We’ve had £20 and £50 notes since 1725, then handwritten on one side