Which account do you keep your emergency fund in if you have one?

[mechanicalpencil]

I am in the process of re-building up a small emergency fund(for replacing washing machine, boiler etc if anything breaks) which has been recently depleted.

Previously I have just kept it in my current account as I like the security of having a buffer and I know it’s immediately accessible. However, it seems a bit of waste to keep a couple of thousand in there on negligible interest.

I have an Isa but there is a limit on withdrawals.
I also have some premium bonds.

I was wondering what others do?

Thanks

I just realised my ultimate emergency fund is a credit card. Then you have like a month to get funds out of savings.
I don't think I ever had emergency which couldn't be either paid by credit card or wait 3 days with the invoice

I have a mix of accounts

A fixed account usually 6-12 months depending on what expenses I forsee coming up over the next year. Usually about 1/3 of my savings are in a fixed account
A cash ISA /cash savings account with the best current rate usually 1/2 my savings
The remaining amount I like to keep with the same bank as my current account. I'm with first direct and at the moment i have a bonus savings account with them paying 4% on any months you don't make a withdrawal. It's not as good as my other savings account but it's better than just sat in my current account and it's as accessible.
I try to work out how much I'm saving each month and set up standing orders into easy access account for just under that amount to make the most of interest without the hassle of actively managing where money is and every 3-6 months review interest rates on my accounts to check any bonus rates haven't ended and the rates I have are still competitive

It’s 6% monthly, yes it’s lower amounts that can be deposited but if you let it build up then you’re on a higher interest rate than an ISA for example. It’s only taken me about 8 months to build up over 2K as I can add round ups too. 6% on 2K monthly is better than 4.5% which my ISA is paying at the moment. My ISA is maxed out too so it’s useful to make sure that higher interest is being earned. I have other money in PB too. So I’m not suggesting it’s the ‘best’ way to save money but as part of savings / investments package it’s a useful one to have rather than money earn no interest sitting in a current account.

Are you sure it’s monthly? Because I did some googling and reading after posting this and I can’t find any accounts that pay 6% interest on the entire balance every month. Could you share what account this is?

We have Marcus accounts each that pay around 4.5% interest. They're linked to your main current account, so very easy to transfer in/out, and pay monthly interest. If we ever get caught out, a quick login to their app and money over to the current account immediately. Very simple.

I have the maximum allowed number of “pots” with Chase, and use one of those for emergency savings.

You're right, it will almost certainly be 6% annual equivalent rate. No-one is paying 6% monthly.

Usually the interest is calculated daily on the current balance, and paid either monthly or annually.

My Emergency Fund is in a Moneybox Cash ISA (fixed rate of 4.62% until October.)

I have a First Direct regular savings account, which I save £40 into each month at a 7%. I wish I could afford to save more!

I also have some money in Premium Bonds too, but that’s earmarked for some building work.

I have it in an easy access isa - can be back in my account in 2 minutes via the app

Hi everyone,

Just to update: I have opened an online Instant Saver with ATOM at 4.6%.

Thanks for all the suggestions, it was really useful to read about what others do.

I have that Atom account but use it for savings that I don’t expect to need regularly as the interest rate drops after 3 withdrawals in a year. I also have one which allows unlimited withdrawals with a slightly lower interest rate and use that for known future expenses like holidays, tax bill etc.
I used to prefer to centralise everything with one bank but find it really easy to open and monitor various savings accounts online now I’m used to it.

Our emergency fund is in an instant access e saver. No point in locking it away if it is for emergencies. We keep a small buffer in our current account. The ISAs are not for emergencies as they have limited withdrawals or are invested.

I'd recommend Cahoot sunny day saver at 5% (variable for a yr). Instant easy access, unlimited withdrawals, shame it doesn't have an app though but the online banking isn't bad. They do only pay interest on the first £3k so it depends on how much you need in easy access.

Mortgage offset account.

If you are saving new money each month then a regular saver is the best overall if the AER % is higher. If you have a lump sum to save then personally just find the best paying account you can.

Premium bonds are a sub optimal way of saving, yes you may get the excitement of winning big but do you really know what's those odds are. For most people an interest paying account is going to at least return a guaranteed amount. Premium bonds are tax free, which may make them suitable for people that have already maximised other tax advantage wrappers and allowances

Mine is in a Zopa account that gets 7.5% interest

Liquid funds into lots of different saving accounts with easy access.

£1000 in a case in the bedroom just in case, other accounts yes but if instant cash is needed it's always there.

We have a lot of what you might call "levels" of saving:

• Current account, which I try and keep never going below £500 balance so there is always room to pay an immediate bill. 0% interest.

• Joint instant access savings account - this is where me and my DP put money that we intend to spend within the next 6-12 months, such as saving for holidays, but is also the fund we raid for things like a new washing machine if it breaks. Around 2% interest.

• Cash ISA - this is what you would call longer term saving, and is only dipped into more rarely for bigger things. Around 4% interest.

• Stocks and Shares ISAs (including Lifetime ISA) - this is really for retirement, not emergencies, though in theory if there was a big emergency (like redundancy or serious illness) the S&S ISA could be raided to pay the mortgage.

Fidelity S&S ISAs.

You get 6/12% on the balance each month. The first payment gets 6% for full year, 12th payment gets 6% for 1 month. Overall 3% per year. Probably better than any other savings account.

What account is that? Best I've seen on Zopa is 7.1%.

Diminishing by the day!!!!