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How much should I have as emergency saving and normal saving ?

by coco 12 January 2010 |

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41

lovelindstrom posted
Hi coco
It is generally recommended to have (at least) three months' salaries as emergency savings.
Posted on 13 January 2010 | Love 0 loves Report
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manzanilla posted
It depends on your circumstances. If you have a partner, then you are 'safer' because it is unlikley that you will both lose your jobs at the same time (unless you work for the same employer!).
You really need 3 months expenses saved, no 3 months salary - of course if you spend all your salary, these may be the same amount!
If you don't have a car or a house, many of life's emergencies, won't be your problem :)
It can be an interesting exercise to think what savings you could easily make if you had to: cancel newspaper deliver, stop going out every Friday, don't contribute to child trust funds, halt pansion fund contributions, stop charity donations, plan on no holidays etc
If you have debts, then you would almost certainly be better to have a much smaller emergency fund and pay the debts off quicker.
So that is 'emergency saving'. How much 'normal' saving you should is impossible to say! It depends on your plans. If you want to buy a house, you need to save up for a deposit. If you want to retire at 40 with a nice life style, you need millions.
manzanilla
Posted on 13 January 2010 | Love 0 loves Report
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coco posted
Thank you for yours answer. I am currently saving 75 pounds a month, I am in process to change electronic provider, cancel my gym , reduce tfl. But I am far from one month salary this worry me a bit,

Posted on 13 January 2010 | Love 0 loves Report
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MikeGG1 posted
Coco
If you are single in your own accommodation then think in terms of 6 months net pay after tax less your regular savings (£75).
If with a partner and both are working then probably 4 months net each and if living at home with parents then probably 2-3 months.
Savings are best in a 12-month fixed-rate monthly saver account. 5% with Norwich & Peterborough if you have dependent children or 4.5% with Principality (£20-£500 per month) or Stroud & Swindon (£10-£250 per month).
Mike
Posted on 13 January 2010 | Love 0 loves Report

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