How trouble in the eurozone affects you

Economic instability in the eurozone has affected the lives of millions of people on the continent. As uncertainty continues, and the wounds threaten to get deeper for the single currency, the pain will be felt in the UK too.

How will that affect you? What does it mean for your chances of getting a job, a mortgage or a decent pension?

Experts are agreed that there is a degree of guesswork over the ultimate outcome. Yet experience and existing regulations provide both concern and comfort for UK residents.

Eurozone turmoil and you
	What could happen	What is being said
Homes and mortgages
	More upheaval in the eurozone would mean banks were likely to take a more cautious approach to lending money, in part because they would not have as much to hand out. That could mean even tougher conditions for first-time buyers, who will again require a large deposit to secure a mortgage - perhaps about 20% of the value of the home they want to buy. Some may not want to buy anyway at a time when their jobs could be at risk. Fewer first-time buyers mean more tenants - andrising rents.	The Council of Mortgage Lenders says more eurozone uncertainty is "not a particularly comforting backdrop" for the UK's housing and mortgage markets. More bad eurozone news could affect mortgage costs, availability and activity.
	Choosy lenders will continue to make home loan offers only to those whom they trust totally to make repayments, which spells difficulty for the self-employed or those who have missed payments on loans or credit cards in the past or who are not on the voters' register. These mortgages may also go up.	Andrew Montlake, of mortgage broker Coreco, says a eurozone storm has been brewing for some time, so banks and building societies are preparing for it. A Greek exit from the single currency would be less of shock than the collapse of Lehman Brothers in 2008 and the subsequent banking crisis. That means the knock-on effects on householders in the UK will be less pronounced, he says.
	Investors from Greece and Italy have already shown interest in buying homes in the UK because they think that it is a safe haven for their money. These sales have made the London market operate on a different level from the rest of the country, withprices going up in the capital but falling - sometimes sharply - elsewhere.	Prices rose by 5.1% in London in the year to the end of April, Land Registry figures show. That compares with a fall of 1% across the whole of England and Wales.
Safety of savings
	Trouble in the eurozone means trouble for the banks. But whatever happens, there is protection for savers who have deposits in those which are regulated in the UK. The first £85,000, even if that bank, building society or credit union goes bust. For a joint account, the protection doubles to £170,000. This is overseen by the Financial Services Compensation Scheme (FSCS). It is funded by the industry, but the government already stands behind it. People can call the FSCS or visit the Financial Services Authority website to check whether their bank is regulated in the UK.	"If savers have more than £85,000 in a bank account, then they should think very carefully aboutspreading their money across a number of banks and building societies," says Mark Neale, chief executive of the Financial Services Compensation Scheme.
	Some European banks, such as Santander, have UK subsidiaries. They are covered by the UK compensation scheme. However, other European banks are covered by compensation schemes in their own countries. In the eurozone, this offers deposit protection of100,000 euros. However, this would not protect the overall value of savers' money in a country that exits the euro and devalues its currency.	Faced with a "slow and silent run on banks in Italy, Spain and Greece", there has been an acceleration in attempts to create a eurozone-wide deposit protection scheme, says the BBC's Business editor Robert Peston.
	When Icelandic banks failed in 2008, the UK government stepped in to protect UK savers with Icelandic bank accounts, but there is no explicit promise to do this again if another country's banks fail.
	The interest paid by banks to savers has been at record low levels. Any further eurozone trouble means those rates would rise later rather than sooner.
Pensions
	As with housing, pensions would be affected by the UK being seen as a safe haven amid eurozone turmoil. Pension funds are big investors in UK government bonds. If the cost of buying them rises, and the return on holding them falls, pension funds would not be in such a healthy position. That might mean more businesses closing their final-salary pensions - the most generous workplace pension schemes - to new or existing staff.	Joanne Segars, chief executive of the National Association of Pension Funds, says a flight to safety by investors to UK government bonds is likely to push private-sector final-salary pension schemesfurther into the red.
	People who have been putting money away into a personal pension use those savings to buy anannuity - an annual retirement income for the rest of their lives - when they retire. Insurance companies invest this money into government bonds. So, when they sell these annuities, the income pensioners will be able to buy is likely to be lower than before the eurozone crisis.	Those with 20 years or more to wait until retirement should not panic, says Malcolm McLean, a consultant for Barnett Waddingham. Those who are about to buy an annuity should seek advice on when to buy, which type of annuity to choose, and how to shop around.
Outlook for jobs
	The eurozone is the UK's biggest trading partner. Official statistics show that nearly 47% of UK exports went to the eurozone in 2011, while nearly 43% of UK imports came from the eurozone. A long-term spiral of decline in the economies of Europe would mean less demand for UK good and services, and that could mean job cuts, especially in manufacturing. Governments have been pushing for a growth agenda, but eurozone uncertainty leads to a lack of confidence among businesses. That means a pause in new investment and new jobs, most notably for younger workers.	"The honest answer is that no-one really knows how bad it would get. We have never been in this position before," says Ian Brinkley, director of the Work Foundation think tank. "The one thing that is certain is that a worsening crisis across the eurozone would be bad for jobs in the UK."
	A euro-wide banking crisis would squeeze the amount of credit available to firms to expand and create new job opportunities. Small businesses could be hardest hit. If the eurozone survives the crisis, austerity measures are still likely to affect employment, especially in the public sector. If the single currency falls apart, this would be many times worse.	When recent unemployment figures were published, Employment Minister Chris Grayling said that the UK faced "significant international uncertainty" that could affect jobs.
Investments
	Investors are often faced with confusing jargon. For some, the value of their pension is their only exposure to the success or failure of investments. Others have money put into a stocks-and-shares Isa, or invest directly in the stock market. Investments in shares have been volatile as a result of eurozone troubles, which can be seen in the performance of the FTSE index of 100 leading shares. However, taking a more conservative approach by investing in bonds has been expensive. Forecasting what happens to the value of investments if the eurozone crisis escalates is extremely difficult.	Investments can always go down as well as up, sotiming is the key to making a profit. Anna Sofat, of financial services company Addidi, says splitting money into different investment pots and taking a long-term view may be the safest approach for investors amid volatility in the markets.
Holidays in Europe
	UK holidaymakers are finding that their pound is buying more euros than at any time in the past three years. Worries about the eurozone have weakened Europe's single currency. Meanwhile, the pound is recovering value that it lost in a market rout during the 2008 financial crisis. Pensioners from the UK who live in Europe during the winter will see increased spending power in their UK pension, which is paid in sterling.	A number of currency experts have predicted that the pound may continue strengthening against the euro, meaning UK travellers' holiday money could go even further this summer.
	The question has been asked for many months whether Greece will leave the euro. Elections and negotiations will provide the answer relatively soon. However, a return to a drachma would create many more questions, not least because there is simplyno mechanism set up for a country to leave the euro. About 5% of the 36 million holidays taken by the British abroad are to Greece and its islands. If Greece adopted the drachma again, it is likely thatvisitors on holiday will see their money go much further because the process of leaving the currency will almost certainly involve a simultaneous devaluation of the new currency against the pound.	For Greece to leave the euro would be a huge administrative task, so "it is highly unlikely holidaymakers will be left stranded in Greece with unusable euros," says James Hickman, managing director of currency firm Caxton FX.
	Holiday-home owners in Greece will see the value of this property fall if it leaves the single currency. If they rented it out and charged in euros, it would be more expensive than other holiday homes and they might struggle to find tenants. But if they charged in drachmas, they might find this earns them very little once converted back to sterling or euros.