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Amid increasing concerns over frequent bank outages, millions of UK households are being strongly advised to withdraw £400 in cash and keep it securely at home for emergencies.
With disruptions to digital banking services becoming more common, financial experts emphasize the importance of having physical cash readily available to cover short-term essential expenses.
This recommendation follows warnings from finance expert Fred Harrington, CEO of Proxy Coupons, who highlighted the growing instability in digital payment systems and the need for practical cash reserves.
Why the Warning Was Issued
The recent surge in banking system outages has left many consumers without access to their funds, even for basic needs such as food and transportation.
These outages have affected both mobile and online banking platforms across major UK financial institutions. In response, Harrington and other experts are advising the public to consider holding small cash reserves at home.
According to Harrington, the average household should keep £200 to £400 in cash—enough to manage 3 to 5 days of emergency expenses.
“Think about what you’d actually need if the power went out for a week or if banking systems went down,” Harrington stated. “You need petrol money, groceries, maybe cash for a pharmacy or urgent repairs. You’re not funding a holiday.”
How Much Cash Should You Keep?
Here’s a breakdown of the suggested cash reserve and what it could be used for in an emergency:
| Category | Estimated Amount (£) | Purpose |
|---|---|---|
| Groceries | 100 | Basic food supplies for 3-5 days |
| Petrol/Transport | 60 | Refueling vehicles for commuting or travel |
| Medical/Pharmacy | 40 | Emergency prescriptions or over-the-counter meds |
| Emergency Repairs | 100 | Minor home or appliance repairs |
| Miscellaneous | 100 | Unexpected costs (e.g., childcare, hygiene) |
| Total | £400 | Covers essential expenses for up to 5 days |
Things to Keep in Mind
While storing some cash at home can offer peace of mind during outages, security and documentation are crucial. Harrington warns:
- Avoid keeping excessive amounts beyond what your home insurance will cover. Most policies have strict limits on cash reimbursements in case of theft or loss.
- Keep receipts for significant withdrawals and document where the money came from to avoid any legal issues.
- Store the cash securely, in a locked safe or hidden compartment, and inform only trusted family members.
“The goal isn’t to become a doomsday prepper,” says Harrington. “It’s about having a reasonable backup plan that doesn’t create more problems than it solves.”
A Practical Approach to Emergency Cash
Fred Harrington likens keeping emergency cash at home to owning a fire extinguisher: you hope never to use it, but it’s essential when needed. He recommends a balanced approach:
- Don’t hoard large amounts of money.
- Avoid dipping into emergency funds for non-essential purchases.
- Educate household members on when and how to use the cash appropriately.
Many people make the mistake of thinking they need thousands of pounds, when in reality, a few hundred can go a long way in a temporary crisis.
As digital banking reliability continues to fluctuate, experts urge UK households to keep £400 cash at home for emergencies.
This practical move ensures access to essentials during outages, without risking large losses or violating insurance limits. Keep it secure, documented, and truly reserved for real emergencies.
FAQs
Why exactly £400—why not more or less?
Most families can meet 3–5 days of basic needs with £200–£400. More than that could pose insurance risks and tempt unnecessary spending.
Is it legal to keep cash at home in the UK?
Yes, but be sure to keep documentation of where it came from to avoid scrutiny during audits or investigations.
Where is the safest place to store home cash?
A lockable safe, hidden and secured inside your home, is the most recommended option for storing emergency cash.