How much to keep in savings for a rainy day?

[ridinghighinapril]

We have had the luxury of very low monthly mortgage repayments for several years, which has allowed us to save a considerable amount. It's now time to upsize our property (no choice to stay on as it is too small for us) and we are in the process of moving. As a result, the majority of our savings will be going towards the deposit. We will still have some savings but DH is wondering whether we will have enough. My personal feeling is that we have not been living in the real world in terms of what is the norm for mortgage repayments and savings and so would like a bit of a reality check! I don't expect people to divulge their savings (unless you want to) but is there a guide to how much you ideally should have in the bank e.g. 3 months salary, fifth of annual salary?? I know it comes down to the specifics of your circumstances but would like to (hopefully) reassure DH that having 'only' £x 000 is not something to lose sleep over.

Just to add, not sure we will be able save much in the first couple of years, as we will need to furnish the property bit by bit etc.

Rule of thumb is to imagine both of you unemployed/earning zero for 6months,and have enough saved to cover all expenditure for that time.

We have £0, causes me countless sleepless nights but extortionate rent means saving is impossible.

In an ideal world id have 3 months salary in case either of us was made redundant.

3 - 6 months outgoings is recommended. Savings aren't really making any money at the moment so buying a house or something else that's going to appreciate makes sense.

savings?

What the fuck are they?

Do remember that people often say 3 x or 6 x income, but what it should reAlly be is 3-6 x outgoings (ie if you regularly save £500 a month, you don't NEED that money in an emergency scenario , just enough to cover all bills, food, petrol, spends etc, not to continue saving too!)

Thanks all, incl. mokeyface - it's the sort of thing you can not really ask friends, even good ones, without them having to divulge too much personal financial info!

for many, many years I had a virtual savings account
otherwise known as an unused credit card limit.

Good point, takin' -we have been fortunate/savvy/frugal so far and always paid off our credit card each month but it is good to have that buffer, which hopefully we won't need.

ridinghigh
joking apart, having several thousand in CC limit that can be pulled in emergencies and then cleared over the next couple of months is IMHO the best way to save with low interest rates

As much as you can. That's it.

Most people do not have any savings AT ALL.

ps this thread has been done to death so if you want to read about how some people have zero and others have £100k or whatever then you just need to search.

loopy
I coordinate the debt thread. Helping people with nothing to develop the save for later mentality and build up emergency cushions is a daily topic for me.

3-6 months of outgoings is the standard recommendation, but I do think it depends which sector you work in. DH and I both work in roles which are relatively secure with good sickness benefits. We aim to have 6 months saved, but would probably be ok with 3. But in other sectors where redundancies are more likely, where it might take a while to find another job, or where you just get statutory sick pay after a short time, I'd be looking to have a bit more saved.

Jeez loopy - show me a topic that hasn't been.

Sorry loopy(!). I did find a thread where people said how much they saved but absolute numbers is of no interest to me - £500/month may cover outgoings for one whereas £2000/month may not help another.

If it bores you then don't bother reading the thread or commenting on it, for that matter.

Thank you to everyone else.

I'm entitled to my post just like everyone else is entitled to ask about savings/how often they wash their sheets 79,006 times a week.

Really interested in this (and actually haven't seen a similar thread before despite having been here for 2 years).

We have about a year of DH's salary saved which we think would cover us in terms of outgoings for a year when I stop work when next bump is born. This feels like too much compared with 3-6 months of outgoings but the fear of the unknown is too great to spunk the difference on an extension or multiple fancy holidays.

I think when you've always been a saver it's difficult to let go of that cushion. Nice problem to have though so mustn't grumble.

The only savings we have are what remains of my trust fund (not as grand as it sounds!). Would cover us for about 3 months.

Sure loopy post as you wish but don't imply it's the OP that is dull...

We have joint savings to cover us for well over a year and a miniscule mortgage. That's plenty, the rest is to spend as we please. We moved a while back and spent some on house stuff, but soon got back into saving again.

We only have a few grand atm but I'm happier when it's enough to cover 6 months of not working

Talkin that's made me feel better, we have at least 6 months salary in unused credit card balance!