Savings 'essential for emergencies'

Since the recession has taken a firm hold on all of our finances, many people have opened savings accounts to put money away for a rainy day. Despite the interest rates being quite low on these accounts, many are still choosing to save rather than pay off immediate debts, as they feel that the possibility of some financial burden arising in the near future is a plausible one.

"Savings should be a high priority for people as they are essential for coping with an emergency", claimed a leading finance organisation.

A study, carried out by National Savings and Investments (NS&I), found that 38 per cent of people do not have cash stored away, with the same number commenting that "life is too short" to worry about such events.

On average, respondents said that £5,368.70 is the amount of money needed to cope with unforeseen circumstances - this covers home and car repairs, vet bills and other large payouts that could leave you out of pocket if the worst was to happen.

"People often forget about things that could happen at any time - funerals are a common oversight, for example, and they can be very expensive. Being hit with the death of a loved one and some hefty bills can take a heavy toll on anyone."

One spokesperson from the group has urged Britons to understand the importance of saving money for rainy days.

"It's essential that we are all prepared for any emergency that will require immediate access to money," he said

The survey also revealed that around half (53 per cent) of Britons would consider taking on secondary employment to cover adverse situations, while 33 per cent admitted they bought unnecessary luxury goods with their savings.

"Working a second job may seem like a good idea, but its very easy to become quickly run down juggling long hours and family life - it is often neccessary to do this, but highly unrecommended, especially when saving for a rainy day is often the better option."