Putting some money away as emergency fund

jamels2

Can anyone suggest the best way I can put some money aside each month as an emergency fund?
I currently use virgin for mortgage and nationwide for current account
I initially looked at the Isa advertised on virgin but I have to pay in within 30 days, I'd like to put say 2k in initially and add 500 a month.
Not sure what product is suitable.

Zero_Sum

Do you want instant access?

jamels2

Not really as it makes it too easy to get to.... I like the Isa idea of saving 20k a year but it looks like you can't add to the balance after 30 days

PEHsaver

Easy access to your money in the case of an emergency is advantageous for it to serve its purpose , you just need to be disciplined with it. I would put it into an easy access savings account , I have a £10,000 emergency fund which has remained untouched , I would aim for 3 - 6 months of expenses.

easterbunni

Premium Bonds?
An emergency fund needs to be 'easy to get to', however it won't remain an emergency fund if you don't budget for it.

Zero_Sum

There is the single access option

Socajam

You could put the money into National Savings and Investments (NS&I) - Direct Saver
Everything is done online and just have the account tied to your main checking account - https://www.nsandi.com/
I believe the interest is 1%, but if you can get more interest elsewhere I would take it.

worried_jim

https://www.marcus.co.uk

jamels2

I have about 2k now but want to add to it each month

Terry_Towelling

Does it have to be an ISA?

I'm also confused about the purpose of the fund. If it is an emergency fund then surely you want quick, easy access because it's an emergency. Restricting access means you can't get at it. I accept in an ISA you always have the option to transfer funds away (even in fixed term ISAs) but you usually pay a hefty interest penalty as a result.

If you can tolerate a reasonable access delay for any emergencies you envisage, you can open a Notice Account. Paragon currently pays 1.8% on its 120-day notice account, so you can't spend it willy-nilly because you have to wait 120 days from giving notice.

Masthaven Bank allows you to set your own fixed-term period, so you could open a 12 month account with £500 this month and then an 11 month account with £500 next month etc (the interest rate drops slightly as the term reduces). The minimum term is 6 months - so for the second half of your savings year you'd need to do something else with your savings to keep them accessible by the 12 month deadline.

Frankly though, the whole point of an emergency fund is to have the money readily accessible for the emergency, or there's no point. Have you considered a couple of easy-access regular savers - £250 per month into each one and a reasonable interest rate - usually above 2%

strawb_shortcake

We are looking at putting what will be our mortgage overpayment and emergency fund into a co-op saver account, 1.4% interest if you make no more than 4 withdrawals a year.
We are also going to put some money into premium bonds, we may need access this in 3.5 years time. I think there is probably better places to put this money but my Husband's health has taken a bit of a hammering this year so has trouble concentrating so it's likely to be a temporary measure until he's feeling more himself.