One in five of the British people have no savings to fall back on in the event of an emergency, according to The Independent. Even those who do have savings don’t have very much. 14% have less than £100 squirreled away, and 39% don’t have more than £1,000. But, as an emergency fund is crucial when you’re short on cash following an illness or the arrival of an unexpected bill, it’s essential you do everything you can to boost this pot.
Claim back what you owe
If you wear a uniform to work and clean it yourself then you could be due a tax rebate. And, the best thing is you can claim back up to five years. A basic-rate taxpayer is currently eligible to claim back £12 per year. However, this will be bigger if you’re in a higher tax band or if you wear a specialist uniform. Ultimately, anything that you claim is free money and is a great way to top up your emergency fund.
Say goodbye to debt
The typical British household owes £15,400 to personal loan companies, credit card providers, and banks, according to the TUC. With the average home now owing £886 more than it did the year before, getting on top of your finances is the best way to ensure good financial health. Consolidating your debts is one way to make it easier to manage your repayments. By doing this, you’ll typically benefit from a lower interest rate and will only have one monthly repayment to meet. Once this is sorted, the savings you’ve made on interest can be added to your emergency fund.
Save your spare change
Apps such as Monzo which round up your purchase total can help you save up to £450 per year. If you spend £9.65 at the shops, £10.00 will be debited from your account and 35 pence will be added to your emergency savings account. While this might not sound like much, it will soon add up over the course of a year. So, be sure to pay via one of these apps when you next hit the shops.
An emergency fund is a crucial pot of cash that all households should have. To ensure that it’s a reliable source of money to fall back on when times get tough, you should claim back what you owe, get on top of your debt, and be smart with the way you handle your spare change.