Emergency fund - real world examples

surreysaver

Barkin said:

Emergency fund?  I just have 'funds'... 

An emergency fund is a bit of a misnomer. People should just have enough liquidity to cope with sixth months of expenditure with no income 

Jami74

El_Torro said:

What I'd like to see in this thread is examples of people's emergency funds. I'll go first, all interest rates are quoted in AER:

I don't really have an emergency fund as such. If I had to make a sudden unexpected large payment for something I would use one of five credit cards and figure out over the next few days which savings account to move the money from. Alternatively I could transfer some money from one of my savings accounts to a current account in order to use a debit card. I have wondered whether I should keep £100 of actual paper money somewhere in my home in case of complete internet failure, but then I've always got enough food/toilet paper/petrol that I could survive a few days offline.

Newly_retired

I have various Regular Savers and Bonds that wil mature, when they are coming up I consider whether I want to plan a big expenditure egsg I might change my car next year, so I must make sure I have enough cash not tied up. In accessible savings I have an easy access ISA, and a savings account attached to my current account, Both pay reasonable but not top rates, but I like the security of knowling I can pay for a new boiler, or major repairs to the car.

VNX

20k at 5% in tandem that’s it 

noclaf

Currently I don't have an allocated emergency fund but I am heavy in cash as a large proportion is earmarked for house rennovation work. Once that has been spent I would want £30-40k accessible cash....that seems high but my job security is a bit up and down at the moment so I tend to err on the side of caution/helps me sleep better at night.

I spread my money between Santander/Marcus/Oxbury/Shawbrook to try earn better than paltry interest. In a worse case scenario I have an S&SISA where investments could be sold to generate cash but that's absolute last resort and given the 3 business days needed to complete a sale not sure that could be described as an emergency fund!

jimjames

Barkin said:

Emergency fund?  I just have 'funds'... 

When 34% of people have no savings or less than £1000, having any savings whatever you call them is a worthwhile thing.

• Almost two-thirds (65%) of people believe they wouldn’t be able to last three months without borrowing money.

https://www.money.co.uk/savings-accounts/savings-statistics

Exodi

Our aim is to have £5k in joint savings for various emergencies, though that said we haven't had the best luck with repairs over the past 12 months so have been using it and topping it up (I guess that's what it is for after all).

Our garden wall became unstable last summer, needed to be knocked down and re-built @ ~£2.5k Boiler gave up the ghost at Christmas (was ~15 years old to be fair) so needed to be replaced @ ~£2.5k. Leak last month in upstairs bathroom ~£200 and this month a leak near the underfloor heating manifold ~£300.

It's nice being able to pay for all these things in cash when they happen, but unfortunately we're now in the process of replenishing them (at about £1.5k at the moment). We have personal savings and investments of ~£20k we could access if we really had to.

Chip pays 4.84% interest and provides near instantaneous withdrawals (among other apps) so I don't see any reason to leave thousands and thousands of pounds wallowing away in a 0.1% interest current account.

Nebulous2

Having retired earlier than intended, moved to a cheaper home and put a public sector pension into payment,  we find ourselves with far more cash than we have ever had in our lives. We had big ambitions to renovate our home, draw on our capital to see us through to state pension age, and to travel extensively. More or less all of those needs for cash have gone. We've scaled back our renovations, I've taken a part-time job, which means we haven't needed to draw on our capital, and caring responsibilities have meant that we haven't travelled as much as planned. 

We're sitting on about three years expenditure, or seven years expenditure if we deduct my DB pension, primarily in premium bonds. 

I don't regret committing so much to cash, things might have taken a different route, but it was almost certainly over-provision from the start. 

 

boingy

Nebulous2 said:

Having retired earlier than intended, moved to a cheaper home and put a public sector pension into payment,  we find ourselves with far more cash than we have ever had in our lives. We had big ambitions to renovate our home, draw on our capital to see us through to state pension age, and to travel extensively. More or less all of those needs for cash have gone. We've scaled back our renovations, I've taken a part-time job, which means we haven't needed to draw on our capital, and caring responsibilities have meant that we haven't travelled as much as planned. 

We're sitting on about three years expenditure, or seven years expenditure if we deduct my DB pension, primarily in premium bonds. 

I don't regret committing so much to cash, things might have taken a different route, but it was almost certainly over-provision from the start. 

 

Having retired early myself I know exactly where you are coming from. It takes a while to realise you have "enough money". The reason you have enough money is that you have been prudent and sensible in your working life. It's really hard to start spending that carefully saved money. If you find a way, let me know!

VNX

jimjames said:

Barkin said:

Emergency fund?  I just have 'funds'... 

When 34% of people have no savings or less than £1000, having any savings whatever you call them is a worthwhile thing.

• Almost two-thirds (65%) of people believe they wouldn’t be able to last three months without borrowing money.

https://www.money.co.uk/savings-accounts/savings-statistics

This is quite sad/depressing to read