Around 15 million UK adults have so little savings that they would struggle to have any money left for the weekend should something go wrong today. People have been urged to start setting aside greater amounts of money into savings accounts after research from HSBC revealed that almost a third of adults have less than five day's average pay in savings.
The survey found that 30% of adults have less than £249 set aside as a financial safety net, a figure which is the equivalent of just five days average take home pay. The recommended minimum amount to have in the form of emergency savings is three months pay, which equates to £4,683. Worryingly, almost one in five (19%) people surveyed claimed to have no savings at all to fall back on.
"These findings demonstrate a worrying lack of preparation amongst UK residents," said Richard E Brown, head of savings for HSBC.
"With the current climate of uncertainty, it is of utmost importance that people are setting aside a realistic sum of money to be used in emergencies."
With interest rates remaining historically low, it's vital to find a savings account in which your money is working the hardest that it can for you. A savings account such as NatWest e-Savings, which pays 2.89% AER, is an ideal home for emergency savings, as you'll be able to withdraw the money instantly at precisely the time you need it most.
Having savings you can lay your hands on straight away is vital, but it is also worth remembering that higher rates of interest are often available if you're willing and able to put your money away for a set length of time. Such savings accounts are ideal if you already have an emergency fund and want to earn better amounts of interest on other savings.
For instance, Santander's Two Year Fixed Rate Bond will pay up to 3.50% if you can leave your money untouched until November 2012, while Lloyds TSB's Three Year e-bond pays 3.75%.
"By putting away a small sum each month, Britons can help themselves build up an emergency savings pot as provision for any eventuality," added Richard E Brown.
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