What's the right amount to have in an emergency pot?

somethingcorporate

racing_blue wrote: »

£10 in a jar is a phenomenally poor plan, unless perhaps 9 years old and outgoings are mainly sweets.

In which case it's a fortune

I'd suggest 3-6 months outgoings is reasonable. 3 months accessible and 3 months more than may take a bit more time to access (shares etc).

in_need_of_direction

Thanks to all. What I'm hearing is that somewhere between 3-6 months outgoings would be good. Based on this, I'm aiming for 4.5 times outgoings less those that would no longer exist if one of us weren't in work. This gives me a grand total of £6300 plus, taking account of vagaries in accessibility to money £200 in cash (hidden under a pillow away from my 2 not so grown up children). And the good news is, we currently have £4k so only £2.3 to go. We should manage this over 3 months (my minimum worst case scenario notice period) while starting the regular mortgage OPs we committed to at the start of the year.

I really appreciate all the input - this is what's meant by in need of direction.

lawriejones1

racing_blue wrote: »

£10 in a jar is a phenomenally poor plan, unless perhaps 9 years old and outgoings are mainly sweets.

Which exactly the point I was making!

Sadly, most people don't save when the times are good. Like our politicians, I guess!!!

lawriejones1

in_need_of_direction wrote: »

Thanks to all. What I'm hearing is that somewhere between 3-6 months outgoings would be good. Based on this, I'm aiming for 4.5 times outgoings less those that would no longer exist if one of us weren't in work. This gives me a grand total of £6300 plus, taking account of vagaries in accessibility to money £200 in cash (hidden under a pillow away from my 2 not so grown up children). And the good news is, we currently have £4k so only £2.3 to go. We should manage this over 3 months (my minimum worst case scenario notice period) while starting the regular mortgage OPs we committed to at the start of the year.

I really appreciate all the input - this is what's meant by in need of direction.

Just don't forget you stashed the money away .

As a lover of red wine and being of poor memory, I once found a biscuit tin with £130 in it. Nice, but a bit disturbing.

Worst part was that there were no biscuits in there.

in_need_of_direction

And money is absolutely no substitute when you are craving biscuits!

ChesterDog

Prothet_of_Doom wrote: »

I was made redundant in 2001 (and 2009) and my mother said "don't worry, worst case, you can sell the house to me, and rent it off me" which upset my wife greatly. Surely she could give us the money towards the interest on the mortgage and we'll pay her back once I find work ?

Probably not as simple as it seems. Your mother could be reliant on the income from her savings and investments. Her capital might all have to be put to work to provide adequate income for her. If she bought your house and you had rented it from her, the money she used to do so would still be providing a return for her. For her to pay the interest for you - perhaps indefinitely - could (at least potentially) put everyone in financial jeopardy.

Her buying your house means it is definitely safe, pretty much whatever happens. A kind, generous and prudent offer.

Edit: And it was a 'worst case' suggestion, which seems to imply other solutions might have been feasible, but you would have that ultimate safeguard.

puk999

lawriejones1 wrote: »

In a rather old-school throwback I also keep around £500 in the house (hidden) in cash, as I quite like to have it there.

Ditto. After seeing Grecians on the news queueing up to get some money from the bank I figured it'd make sense to have some cold hard cash tucked under the floorboards.

mark55man

One of the points of this sort of fund is that redundancy tends to happen in poor economic climates, exactly the time at which you would be poorly served by cashing in equities.

The idea is to have enough spare so that you can avoid the worst ravages of the recession without cashing in your long term investments.

Well that's the theory ;-) My strategy for 2013 was security of employment and credit cards - fortunately untested and I aim to do better this year

In terms of mortgage overpayments vs alternate investments I got a lot of help from this thread (all 5 pages of it)https://forums.moneysavingexpert.com/discussion/4850293

jimjames

puk999 wrote: »

Ditto. After seeing Grecians on the news queueing up to get some money from the bank I figured it'd make sense to have some cold hard cash tucked under the floorboards.

I'd be one of the people struggling. Most of the time I've only got about a tenner on me as I pay for everything by card when I can.