Tuesday, 13 March 2018 11:15

Many failing to save money for emergencies

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A quarter of the population have failed to stash savings for emergencies, a survey has suggested.

The research showed that 25% of adults don’t have any savings they can dip into to cover unexpected costs or bills.

Commissioned by GoCompare Money, the ‘Rainy Day Savings’ study revealed the average sum earmarked for ‘rainy day’ emergencies was £1,300 but, 42% of UK adults have £500 or less set aside. 

People aged 65 or over said they hold the biggest buffer against unexpected expenses with average savings of £1,614; over half (56%) of people in this age group have ‘rainy day’ savings of £2,000 or over.

Only 14% of those surveyed said that they feel financially prepared for another economic downturn.

 

As part of the survey, people were asked for their thoughts on the banking and financial institutions. 

Over a fifth (21%) said after the credit crunch they no-longer trusted the sector; 37% think that banks have done nothing to improve their reputation since the financial crisis; 13% of people have looked at alternatives to traditional bank and building society savings accounts.   

Georgie Frost, consumer advocate at GoCompare, said: “A Rainy Day savings fund is not just a nice thing to have, it is essential. The perceived wisdom is to have at least three months’ worth of outgoings saved as an emergency fund. Official figures set the average monthly salary around £2,300 - which suggests that many people’s ‘rainy day’ savings typically fall short of the ideal target.”  

 

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