The Yorkshire Building Society has conducted research amongst 2,000 people to see how well they could manage financially if they were to lose their job or suddenly fall ill. The findings made for rather alarming reading.

36% of the group had an emergency fund of less than £500, meaning they could only fund their current lifestyles for around 11 days. Tanya Jackson of Yorkshire Building Society said: ‘In the current economic climate, this research paints an extremely alarming picture. Many people’s finances are already finely balanced due to the rising cost of living. But our research reveals that both state benefits and savings are not viable options for the majority of consumers to rely upon for any adequate length of time.’

People need to build up a more substantial cash fund so they can cope with such a scenario. An amount equivalent to at least 3 months earnings is a good base. This can then be added to over time to take it to 6 months worth of earnings.

This is sufficient time to recover from many accidents or illnesses and return to work, or to find another job should you be made redundant. These periods also tie in with when health insurance policies become payable. 

Tags: yorkshire building society

This entry was posted on Tuesday, July 29th, 2008 at 12:59 pm and is filed under Savings. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.