Manage finances 'by building an emergency fund'

Brits who are struggling financially with issues such as a bad credit rating could avoid further issues by building an emergency fund.

This is the suggestion of first direct, which conducted research that found 21 per cent of Brits have no savings to fall back on.

Concern was expressed that 26 per cent of respondents to the survey claimed they would expect a partner to cover them if they were made redundant.

Head of savings with the firm Bruno Genovese said these figures are demonstrative of a worrying trend.

"With the current climate of uncertainty, it is of utmost importance that families are setting aside a realistic sum of money to be used in emergencies," the expert remarked, suggested three month's salary is a good rule of thumb.

Setting small targets could help with this, as recent research from Skipton Building Society indicated this is an effective method of gaining financial security.

Posted by Tom Burroughs