What's a sensible buffer?

ThePants999

Hi folks,

We're looking at taking another step up the property ladder, and trying to figure out how much of our own money we can sensibly pour into this.

If you take my word for it that our income stream is totally safe, what do you think is the minimum amount of money we should keep back as a buffer against unexpected expenditure?

Thanks in advance!

eskbanker

There's no right or wrong answer but 3-6 months expenditure (or income) are figures often bandied about on here for an emergency fund, but of course your mileage may vary, especially since we know nothing of your ages, health, dependents, financial commitments, lifestyle, risk attitude, etc, etc....

ThePants999

Aye, I'd heard 3-6 months before, but I always assumed that was primarily in case you lost your job and needed to cover your expenditure with no income. I'd like to specifically exclude that possibility, assume that my typical outgoings are covered, and just worry about unexpected costs. But I guess you're right, that's still too general a question to ask without going into lots of boring details of our situation. Thanks!

eskbanker

ThePants999 wrote: »

I always assumed that was primarily in case you lost your job

None of us knows what's around the corner and it's prudent to consider not just losing a job as such but, say, suffering an illness or injury that physically prevents you from doing your job, or car packing up, major house repairs, uninsured losses from floods, family crisis, etc, etc....

EssexExile

ThePants999 wrote: »

But I guess you're right, that's still too general a question to ask without going into lots of boring details of our situation. Thanks!

Even knowing your situation I doubt anyone could help much other than say what they would do & why. We would need to know your attitude to risk, I don't think I even know my own attitude to risk until the situation arrises!

Paul_1977

Personally I maintain six months worth of wages, although I am trying to get it to 12.