An emergency savings pot is something we could all benefit from – yet almost half of us are putting nothing aside. 

New research by website TopCashback has found 45 per cent of people do not have a rainy day fund, and 21 per cent say they don’t have the cash to start one. 

Yet the pandemic has shocked many people into realising the need to put money away – with a fifth of respondents saying they intend to begin putting cash aside for emergencies this year. The main reason given is future job uncertainty. 

Empty: New research by website TopCashback has found 45 per cent of people do not have a rainy day fund

Empty: New research by website TopCashback has found 45 per cent of people do not have a rainy day fund

Empty: New research by website TopCashback has found 45 per cent of people do not have a rainy day fund

Adam Bullock, at TopCashback, says: ‘In these uncertain times it is more important than ever to have a financial safety net. You do not need a lump sum to get started, just begin with small regular contributions that build up over time.’ Those who do put money aside have £7,000 on average. With inflation rising, savers need to work harder to protect these nest eggs. The annual Consumer Prices Index rose 1.5 per cent in April and is predicted to rise 2.3 per cent by June. 

Rachel Springall at Moneyfacts, a financial product scrutineer, says: ‘The highest paying options require you to lock money away and not touch it for at least a couple of years – not ideal for an emergency fund. Study the full range of options when looking at rates to ensure you get a deal suitable to your needs.’ 

One of the best paying accounts is a five-year fixed-rate Isa from Shawbrook Bank – offering 1.1 per cent. But if you want instant access, a cash Isa from Cynergy Bank paying 0.46 per cent is one of the most competitive. A one-year fixed rate Isa with Hampshire Trust Bank pays 0.51 per cent. 

For non-Isa savings, Atom Bank pays 0.5 per cent on savings in an easy access account, or 0.85 per cent if you fix for a year. A fiveyear fixed-rate account with Hodge Bank pays 1.35 per cent interest. 

Savers on a low income can benefit from the Government’s Help to Save scheme, which offers 50p for every £1 saved over four years on sums of up to £50 a month. 

For details go to gov.uk/get-helpsavings-low-income.  

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This post first appeared on Dailymail.co.uk

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