UK households are being urged to find £7,443 in emergency savings as new research reveals a significant gap between unexpected expenses and what people have saved. 69 per cent of people are caught off guard by major surprise bills, it has been warned.
Savings Shortfall Exposed
Three in four people have some level of emergency savings, but Go Compare research shows many may not be protected against an unexpected bill. The average cost of large unexpected bills—such as vehicle repairs, vet bills, and broken boilers—over the past 12 months reached £10,996. However, the average emergency savings pot sits at just £3,553. This £7,443 shortfall means that even those who try to prepare can come up short. Nearly a quarter (22%) of people have absolutely no savings to fall back on at all.
Expert Advice on Building a Safety Net
Abigail Foster, Personal Finance Expert, said: "Many of us are left figuring money out as we go, so it’s no surprise unexpected costs can feel overwhelming when they come along. Taking time to write your finances down, spot spending patterns, build a small emergency fund, and check that you’re still getting great value for your outgoings can all help things feel more manageable. Talking openly with friends and family can help too, whether that’s swapping tips, sharing experiences, or simply feeling less alone in it all."
Charlie Evans, Money Expert at Compare the Market, said: "Unexpected bills can throw even the most careful budgets off track, which is why it’s important to build flexibility into your finances. Start by creating a clear budget so you understand exactly what’s coming in and going out, and try to set aside a little bit each month to cover one-off costs. Even adding small contributions to a rainy day fund can help with the impact of larger, less frequent expenses. It’s also worth reviewing your regular bills and subscriptions to make sure you’re not overpaying, and setting up direct debits or reminders so nothing is missed. If you do need to borrow, plan ahead by choosing the lowest interest option and only borrowing what you can realistically repay. Taking these steps can help you stay in control and feel more prepared when life throws an unexpected expense your way."
To close the savings gap, experts recommend starting small, automating savings, and regularly reviewing outgoings to ensure you are getting the best value.
