Typical family savings would run out within a week in a financial emergency

| November 3, 2012 | 0 Comments

By
Harry Glass

12:08 EST, 3 November 2012


|

12:08 EST, 3 November 2012

Nearly a third of families have savings which will run out within five days if they are faced with a financial emergency, research has found.

Some 31 per cent of those surveyed said they have less than £250 set aside as a safety net if something goes wrong, an increase from 28 per cent when a similar study was carried out last year, HSBC said.

Average monthly household outgoings stand at £1,669, equating to just under £55 a day, meaning that a £250 savings pot would run out within five days.

Money matters: A minimum of three months of take-home pay makes a decent 'salary cushion' apparently

Money matters: A minimum of three months of take-home pay makes a decent ‘salary cushion’ apparently

A fifth of households (19 per cent)
said they have nothing to fall back on at all and another 12 per cent
said they have less than £250 stashed for a rainy day.

People are generally recommended to
build up a minimum of three months of take-home pay as a ‘salary
cushion’, which would typically amount to £5,756.

But the prospect of soaring energy
and food bills and increases to some mortgage costs will make it even
harder for people to put any cash away in the run-up to Christmas.

Meanwhile, the vast majority of savings accounts are still failing to keep pace with living costs.

Some 28 per cent of those surveyed
said they would be unable to cover their rent or mortgage if they
unexpectedly lost their income, while one in 10 said they would be
forced to rely on a personal loan, credit card or an overdraft.

More than 1,000 households took part in the study across the UK. 

Filed Under: finance news

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