Saving up an Emergency Fund

Saving up an Emergency Fund
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Starting an emergency fund. Yes I know that sounds quite boring. However it is a good thing to have at your disposal. Why I hear you ask, well it can help smooth out the financial bumps in the road and help you manage your money a little better, especially if you are in debt.

Why would you need an emergency fund anyway?

Think of those times when something has broken, maybe your boiler or car. Having the spare cash to get those things sorted would be a much better proposition than having to really on your credit card or other borrowing.

When you are in debt, you most likely don’t have the luxury of a credit card and instead maybe have to go for a payday loan. Unfortunately all you are doing is adding to your pile of debt, and you are trying to escape that hopefully.

The Unexpected

The thing about the unexpected is that it turns up when you least expect it. Having your emergency fund or rainy day fund as some people like to call it can help you accommodate that unexpected, and you can expect to deal with the unexpected quite comfortably all going well.

The best place to store such emergency money is in a separate savings account. Otherwise the temptation is there to well erm, spend it. I am of course speaking from experience having raided the savings account on several occasions for frivolous activities. It’s all part of being human.

How much can you save up?

In this day and age I will admit that it can be quite difficult balancing the budget, let alone being good and actually saving some money.

The thing I will say about this is every little helps. It sounds cliché but it does and the amount can add up over time, unless you are saving 10 pence a month or something like that. In that case it will take forever.

I have always wanted to be able to save up three months salary to help cover any unexpected bumps in the road. I am nowhere close yet but maybe one day. I also have a lot of debt so it can be quite hard to save anything at all. However at least there is something in the savings account which is better than nothing.

How else could you save up for emergencies?

  • Stop smoking. Yes it is hard but it can be done. It has been 14 months since I last smoked a real cigarette and I have also stopped the e-cigarettes too. It is saving me a fortune and you don’t feel quite as rough as you do when you smoke.
  • Save your change. Saving your change into a jar or piggy bank can mount up over time. When the jar or piggy bank is full, you can take the change to your local bank and pay it into your savings account. If you are with Lloyds TSB, they have a facility that you can use to set up save the change. When you make a debit card purchase, the amount is rounded up to the next pound and again that can add up over time.
  • Open a separate savings account. An easy to access but separate savings account can help reduce the temptation to spend your savings, although not completely remove that temptation.
  • Cut back on unnecessary expenditure. For example, stop the morning coffee on the way to work, make packed lunches instead of buying one of those expensive sandwiches. Shop around for home or car insurance. Put what you save into your savings account.


  1. says

    Hi Rob, great post! I totally agree an emergency fund is vital, particularly for those of us in debt. I’ve managed to save £500 for emergencies and now put away around £30 per month to keep this topped up. I would much prefer it to be 3 months salary but realistically, because I’m focusing on paying back debt, my fund is going to have to stay around this £500 mark for the foreseeable future. I find that if I do have an emergency, say a car repair, then the following month, I use any extra cash I may find to top up the savings account before resuming with overpaying debts.

    • says

      It would be nice to have three months wages saved up but it is hard when you are also paying off debt. It’s a constant juggling process paying debt, saving money and keeping within your budget but if anything it should mean that when we are eventually debt free we will be much better at managing our money.

    • says

      6 months would be a nice buffer to have but faced with a huge amount of debt to pay, the temptation is too much to use some of that buffer to pay off debt. I agree though that 6 months is definitely a good choice if you can get that amount saved.

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