Rainy day funds for stormy times

There are not enough words, analysis, opinions or memes to describe the current situation. As we sit and wonder what's going on, and try and make sense of it all there are some things we can all learn from the Covid-19 pandemic.

Stuff happens when you least expect it to and we all need to be prepared.

Introducing: your emergency fund

An emergency fund is there to give you access to enough money to see you through 3-6 months if you stop getting paid.

We are currently experiencing unprecedented times. Sadly many will see their income stopped over the coming weeks and months. But it's not just Covid-19 that will cause this to happen. Redundancy and taking time out to care for a loved one are far more usual. All of a sudden anyone of us can find ourselves with bills to pay and no way in which we can pay them.

So what should you do about it?

Start saving. Put money aside every month to build up your own emergency fund, rainy day fund, s**t happens fund, or whatever else you want to call it.

In total you should stash away enough cash to be able to survive without income for three months.

We typically advise that you keep one months income in your current account and an additional two months in a savings account.

Your plan will show you the specific accounts we recommend for you, and the amounts to put into each.

Is it too late?

The impact of Covid-19 is expected to last a long time. There are plenty of opinions out there, but the truth of the matter is that these are uncharted waters and there is no magic ball that will tell us what happens next.

But, it's never too late to start getting into good financial habits so saving now is still a good idea.

Social distancing is no fun, but we can all take the opportunity to learn new things, form better habits, and be kind to ourselves and each other. We're hoping you're keeping safe and looking after yourself.