What makes you feel more financially secure? Is it a target, or a habit?

I noticed the results of some research that was published on a few sites today with some interesting statistics that made me think. Did you see this?

My first reaction is to be impressed that, on average, Britons now have £10k+ in savings, having seen an increase over lockdown periods. Of course, using one number like this hides that it varies widely, and that over 20% of people in this country still have no real savings at all.

I was interested in the idea that there is a single “pot” figure of £17,465 that everyone needs to aim for to be ‘financially secure’ and that you need to be measured by, no matter where you live in the country or what your aspirations and requirements are … but that’s averages for you again.

That aside, it was enlightening to see the results of the survey question:
“What would make [people] feel more financially secure?”

It is understandable that having more cash savings is top of the list (37%), but paying off debt is then second (25%). I presume (hope?) these must be separate groups, as it doesn’t make much financial sense to have larger cash savings (earning virtually 0% interest) while still paying interest on debt (excluding things like mortgages, etc).

It is also heartening to note that 19% mentioned having more money in investments, which I presume may have been those with the higher balances or more secure jobs, but they don’t give this breakdown.

It left me wondering whether it is useful to give “financial security” a specific £ value, or whether it should be about whether we feel we have a process (of saving money regularly and building wealth) that will keep us going over the long run. That’s Financial Wellness (to me).

What were your thoughts?

To be honest, only the housing cost is very different between regions. However, the 17k figure sounds a bit too high. It’s enough for an average single person to live on for more than a year without substantially reducing outgoings, even in the most expensive part of the country. That’s no longer an emergency, it’s more of a lifestyle fund - the ability to quit the job at any time and have a nice long holiday before getting back to work again in a few months time.

You will be surprised how many people have a big pot of savings earning next to 0% interest while paying for interest on their credit card or loan. I have had a housemate who does exactly that.

Or those Gen-Zs thinking about cryptos, NFTs and forexes. For most people who has no idea about investments and has a defined contribution company pension, they are usually much better off just pay more into their pension pot.


Oh, and on the topic of “feel” more financially secure, a bigger cash savings pot will definitely do the job. But to actually “be” more financially secure, that’s only a (part of the) beginning. Overall I think the most important part is not about how much money does a person have nor how much do they earn, it’s financial literacy.

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very good point - but did you notice that “better understanding my finances” (which I guess is similar), is down at only 7%

I’d like to hope that with a bit more financial literacy, more people can navigate their own way to better financial positions without having to change their lives too much

I guess ignorance is bliss if you’ve got 17k stashed away? :slight_smile:

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I don’t have lots of savings but it’s how I do things that makes me happier than how big a balance is but don’t get me wrong money helps in life but I have to manage money better than how high balances are

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I know what you mean - having an overdraft and emergency credit card also help me feel like I could cope better with bumps in the road…

The article doesn’t look at other assets/liabilities - how many people could sell/downgrade their car in a pinch (and conversely, how many who are dependent on their car are driving company cars that would disappear if their job did? how many are stuck on expensive leases they can’t simply stop?).

I guess this all falls under the uninteresting topic of ‘understanding my finances’ :slight_smile:


It’s the old adage of the poor have debts, the wealthy have assets - with a tricky pivot point between the two where you might want a mix to smoothen out bumps and uncertainties with a cash buffer.

Identifying groups on a spectrum from asset-rich to asset-poor will tell you much more about financial security than self-reporting, imo.

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