Emergency Fund Vs Redundancy Package

DriveBlind

I have built up an emergency fund of around 4 months salary and placed it with semi-quick access in premium bonds.  I'd really like to put this in a S&S ISA instead and use it for a long term savings plan.

My reckoning is that I gave been in my job 20 years and my 'emergency fund' could actually be what I would get in redundancy money if the worse did ever occur.  My job is pretty secure at the moment, company doing well etc.. so I'd like the potential of growing my savings quicker rather than using them in a fake dream of a big win on premium bonds which is virtually impossible.  Sounds like a plan ?

eskbanker

Emergency funds are often earmarked not just for redundancy, but inability to work for health reasons, or substantial uninsured household expenses (e.g. boiler replacement), or major car repairs, etc, etc, so consider carefully how you'd handle any such significant events.

Also unwise IMHO to rely on a sizable redundancy payout as an emergency fund - the company could start doing less well and reduce its redundancy provision to statutory minimums, or could even fold altogether (is it immune from current precarious conditions?).

That doesn't mean there's no room for investing some of the money though, but worth mapping out your finances in detail to assess whether there's enough room for manoeuvre to be doing so....

Albermarle

You can not just look at cash savings and S&S ISA in isolation.
What about your pension arrangements ? For many people this is much more important for long term saving for retirement .

Thrugelmir

The value of investments fluctuates. Are you comfortable with making investment decisions? 

takanodia

Before the last Great Depression there are four identifiable stages 

first there is a recession Which are common and happen every decade or so

then a Great Recession which are less common the last one was 2008

then a depression which is even more rare, then if unemployment keeps rising another Great Depression which there has only been one in the last few hundred years