Why You Should Have an Emergency Fund

Written by Karen Bryan

emergency fundI believe that everyone should have an emergency fund with at least 3 months living expenses in an instant access savings account. Building up an emergency fund is part of my advice for working out essential spending in the making a budget series of articles.

You never know when you might need to get your hands on some cash and you really don’t want to be forced to dip into your overdraft possibly incurring charges, or increase your credit card balance and end up paying around 17% interest on the balance.

If you lost your job, it can take time for your job seekers allowance to be processed. I know that our son had to wait months for his housing and council tax benefit to be paid.

I like to keep a farily large emergency fund of £10,000, in case we need to do a big emergency repair on our home or car.

Make sure you do some research on where to save to find one of highest paying instant access savings accounts, such as the Santander eSaver Issue 5 currently (3 July 2012)  paying 3.3% interest (variable).

One Response to “Why You Should Have an Emergency Fund”

  1. […] Help Me to Save, Karen discusses Why You Should Have an Emergency Fund.  She believes that everyone should have an emergency fund with at least 3 months’ living […]