Many people may consider investing their money into stocks and shares for the potential returns that it may bring. With interest rates so low, putting money in a savings account may not seem to make much sense as money may be seen to be depreciating. 

However before investing one’s money Britons should ask themselves ‘why’ and consider safer options that can be just as valuable in the long term.

In an exclusive interview with Express.co.uk, Heather Owen from Quilter explained why investing may not always be the best thing, and the importance of being able to save readily available cash, that can be accessed whenever needed.

She said: “I would always say with an emergency fund, not to invest that – so not looking at building up a stocks and shares ISA. For the long term that’s good – but your emergency fund should be something you can access in a moment’s notice if needs be.

“Have that building up in cash so if the worst does happen, you’ve got a first port of call which won’t then start having knock on impacts on the rest of your finances.”

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However before investing one’s money Britons should ask themselves ‘why’ and consider safer options that can be just as valuable in the long term.

In an exclusive interview with Express.co.uk, Heather Owen from Quilter explained why investing may not always be the best thing, and the importance of being able to save readily available cash, that can be accessed whenever needed.

She said: “I would always say with that emergency fund, not to invest that – so not looking at building up a stocks and shares ISA, for the long term that’s good – but your emergency fund should be something you can access in a moment’s notice if needs be.

“So have that building up in cash so if the worst does happen, you’ve got a first port of call which won’t then start having knock on impacts on the rest of your finances.”

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An emergency fund is money you save and put aside to cover a financial shock. This could be losing your job, or a large, unexpected expense.

It can prevent you needing to borrow money or make difficult financial decisions in those moments, by giving you savings to fall back on.

Ms Owen continued: “Make sure you have an emergency fund in place.

“It can be something which you think, ‘I haven’t got the spare cash to put aside to build an emergency fund, and if something does happen, I can just put it on the credit card.’

“Setting up a small direct debit or a standing order each month, going from your current account, into another side account or savings account just to build up whatever you can is very necessary be it £10, or £20 a month.

“An ideal figure would be three to six months’ worth of your income.

“What this means is that [you have the money ready] if you are not able to work for some reason, or if you’re made redundant or any of the scenarios we’ve seen over the last couple of years. Or even if you’re in work and there are no changes there but the boiler breaks, or something happens with the roof for example.”

“Or even if you’re in work and there are no changes there but the boiler breaks, or something happens with the roof for example.”

When discussing the best ways to start building this fund, Ms Owen mentioned creating a fund goal to keep one accountable.

Britons may want a separate savings account for their emergency fund so they’re not tempted to dip into it. Plus, they may be able to earn some interest to add to savings, however it’s important that this can be accessed easily.

She continued: “A good way to stick to your savings plan is to set up a standing order to move money into a savings account each month.

“Scheduling this for the day you get paid, will lower your temptation to spend it.”

For many people, saving up and building up an emergency fund may be what it most important.

Before investing, or putting your capital at risk, people should consider the security and comfort that having an emergency fund provides.
Any rates of return may come second if “your why is to help you have less stress in your life”, she explained.

Ms Owen concluded: “It’s so important that you’ve got that emergency buffer which you’re building up and building as part of your regular budget, so it come out automatically. Have the emergency fund built up and you just know you’ve got that extra peace of mind there.”



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