Do you want a £1,000 rainy day fund to sit alongside your pension?

Oct. 12, 2024 - This is Money

All workers should be auto-enrolled into a £1,000 rainy day fund in addition to their pensions under proposals floated by an influential think-tank. This would help fund new rainy day savings pots that could be used to manage small cashflow shocks, suggests Resolution.

Money going into the rainy day fund would not be topped up by pension tax relief from the Government, but tax relief would be added to any surplus cash that was rolled over into a pension. Fund manager Schroders and the Pensions Management Institute are pushing for a plan that would similarly help people build a rainy day fund, while saving for retirement and a first home.

'As well as continuing to boost pension saving, auto-enrolment also needs to be more flexible...