Eight million homes have no 'safety cushion'

Almost a third of UK homes have less than £250 set aside for an emergency, and are therefore at risk of instant destitution should redundancy strike, according to research from HSBC.

We may be repeatedly warned to create a "salary cushion" worth three months' net spay – an average of £5,756.20 – but the HSBC survey of 1,000 UK households shows that a fifth have no savings at all to fall back on and 12 per cent have savings of less than £250. With average monthly household outgoings currently at £1,669, these savings would last just five days. What's worse, the number of households in this situation has risen by three quarters of a million to top eight million homes since last year, when 28 per cent had maximum savings of £249.40

Those aged 16 to 24 and 35 to 44 are least prepared for a financial emergency – and are worse prepared than a year ago. Forty-six per cent of the younger group has fewer than £250 in savings while 42 per cent of those aged 35 to 44 are in the same position.

And women are still far less prepared for sudden joblessness than men. More than one in five has no savings at all, and 13 per cent have less than £250 set aside, compared with 16 per cent and 10 per cent of men respectively.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

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