Emergency Fund

Rofo87

Thank you all for your responses so far. I've been looking around at some savers but I need to have a proper sit down and look through what is best for us.

I would definitely be aiming for required amount for all bills and not full income based. We have a few debts that need to disappear quicker than they are but thankfully they are all 0% interest. I've already made a full SOA, we just need to analyze what our variable expenditure is, i.e. food, fuel etc. I've managed to cut some bills by ~£120 a month, this will more than likely be going in to the EF.

Lastly, it doesn't work for me to have to wait for access to an emergency fund. If there's an emergency I need it immediately. So I keep it in an instant access savings account. Not much interest but there you go: It's not primarily an account for saving but an emergency fund.

This makes total sense and I'll most likely be going for this approach.

Thank you all

takman

Rofo87 wrote: »

This makes total sense and I'll most likely be going for this approach.

Just to let you know that if you do decide to keep it in another current account to get a higher rate of interest then a transfer to another account is always almost immediate, if not maybe a few mins. So no real reason to keep it in a poor paying account just because it's with the same bank.

Also it's a good idea to keep it in another bank because if your banks systems stop working then you always have a backup.

badger09

Rofo87 wrote: »

Thank you all for your responses so far. I've been looking around at some savers but I need to have a proper sit down and look through what is best for us.

I would definitely be aiming for required amount for all bills and not full income based. We have a few debts that need to disappear quicker than they are but thankfully they are all 0% interest. I've already made a full SOA, we just need to analyze what our variable expenditure is, i.e. food, fuel etc. I've managed to cut some bills by ~£120 a month, this will more than likely be going in to the EF.



This makes total sense and I'll most likely be going for this approach.

Thank you all

Where do you bank at the moment?

It makes sense to have at least 2 current accounts with different banks, so you're not stuck if one bank's systems go down or your card is declined for whatever reason.

You could look at maximising cashback/rewards on your bills and day to day spending as well as maximising interest on your emergency fund.

Have you read this?

https://www.moneysavingexpert.com/banking/compare-best-bank-accounts

You might even pick up a switching bonus on the way:)

datlex

Rofo87 wrote: »

Hi all,

I'm looking at getting a bit more financially stable by having an emergency fund because currently I have nothing except for a Credit Card for a back-up strategy. I'm aiming for 3-6 months worth of bills eventually but to start with need to get 1 month of bills in a savings account.

My question is, do you have an emergency fund in a savings account that is easily accessible or do you have a separate account for it? Also how long do you expect to have an emergency fund built up, in a perfect world where nothing ever breaks down. (I know that last part is variable depending on income and what you can afford to put away)

Thanks

There are threads in debt free challenges both £1000 emergency fund https://forums.moneysavingexpert.com/discussion/5076051 and a 3 to 6 months emergency fund challenge https://forums.moneysavingexpert.com/discussion/5344441

kaych

Use a regular saving account that allow easy access could be a start.

Depends on who you bank with, I know that lloyds and tsb have regular saver that allow instant access with 3% and 2% interest, respectively. so you can save between £25 - £400 a month. You can also take the money out as and when you need it.

This way, you will be less tempted to take the money out as it’s being saved separately, unless you need them. And after 12 months, if you haven’t used any of the money, you will also get a nice little pot of saving.