Savings wouldn't provide a 'safety net' for millions Go compare with our comparison table

Savings wouldn't provide a 'safety net' for millions

13 October 2010 / by Paul Dicken

As many as 15million people in Britain have less than £250 set aside in savings, a survey for HSBC bank has found.

The survey of 2,100 adults showed that 30 per cent had less than five days average pay saved up, while 19 per cent have no savings at all.

HSBC say that £249 is equivalent to five days average take home pay, while the recommended amount for savings is three months pay: £4,683.

The survey found that those aged between 25 and 34 were least prepared for financial emergencies, and women less prepared than men.

Head of savings at HSBC, Richard E Brown, said: “These findings demonstrate a worrying lack of preparation amongst UK residents. 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.

“By putting away a small sum each month Britons can help themselves build up an emergency savings pot as provision for any eventuality.”

The bank said one in five Britons admit they would be unable to pay their mortgage, rent or other bills if they were unable to work. Just over a third would seek government support or apply for jobseekers allowance in the event they were unemployed, while 22 per cent said they would rely on their partner.

HSBC’s tips for setting-up emergency savings are to set aside a small sum each month, from excess funds in a current account or by giving up small treats; opt for an easy access account to ensure funds are available if needed; and to shop around for competitive interest rates.

© Fair Investment Company Ltd

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Gross is the interest you will receive before tax is deducted.

AER stands for the Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year.