Tips for setting up an emergency savings pot

HSBC research reveals that 30% of adults have less than £249 set aside as a financial safety net. The survey of 2,100 UK adults reveals 19% have no savings at all to fall back on and 11% have less than £249 set aside as a financial safety net. This is the equivalent of just five days average take home pay while the recommended minimum is three months (£4,683).

Those aged between 25 and 34 are the least prepared for a financial emergency, 41% have less than £249 in savings, with a quarter (25%) saying they have nothing set aside at all. Women are far less prepared than men, 20% admit they have no savings and 13% have less than £249 compared to 17% and 9% of men respectively. Across the UK, people in the North West are least likely to have any savings set aside at all with a quarter (25%) admitting they had no financial safety net.

Coping with unemployment

Just one in five (20%) Britons admit they wouldn't be able to pay their mortgage, rent or other bills if they were unable to work, despite setting little aside in savings. Just over a third (36%) would seek government support or apply for jobseeker's allowance while 22% say they would rely on their partner to cover the bills if they were made redundant.

Interestingly 30% of women would expect their partner to cover their monthly outgoings if they were unable to work, compared to just 15% of men who would expect the same of their partner.

Richard E Brown, Head of Savings for HSBC comments: "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."

HSBC Tips for setting up an emergency savings fund:

Set aside a small sum each month into a separate savings account, this could be the excess from your current account or mean giving up a treat such as your daily shop-bought coffee

Choose an easy-access account as you never know when you might need to access your emergency stash

Shop around for competitive rates on your savings to ensure you are making the most of your emergency fund

Set a realistic weekly budget and stick to it, this will help you to see where your excess salary goes, and where you can make savings

Get into the savings habit - set up a monthly standing order into your savings account, that way you won't be tempted not to save for one month