How much cash should I have at home, and where should I keep it?

Telegraph

16-07-2025

The UK Government is urging households to stock up on basic supplies in case of emergencies such as flooding, fire or power cuts.
Alongside practical items such as bottled water, a wind-up torch, a first aid kit and a portable power bank, the advice includes keeping some cash at home to provide essential backup if card payments or banking apps stop working.
Here, Telegraph Money explains how much cash is safe to keep at home and the best way to store it.
Is it a good idea to keep cash at home?
How much cash is safe to keep at home?
Where should you store cash at home?
How else can I protect my access to money?
Is it a good idea to keep cash at home?
Although cash usage is on the decline in the UK, keeping a small amount of cash at home can be a practical safety net. Recent global events, from cyber attacks and data breaches to widespread power outages, have shown how quickly modern payment systems can break down.
Simon Phillips, managing director at No1 Currency, said: 'Most of us take card and contactless payments for granted, and the technology is great – right up until the moment it stops working.
'The nationwide power outages in Spain and Portugal turned millions of people's smartphones into expensive paperweights and left them with only one way to pay for things, which is cash.'
Tobias Ellwood, the former defence minister, recently warned of 'real-world scenarios we must seriously consider', including drone attacks, internet outages and national infrastructure disruption.
Keeping some cash at home can therefore be a sensible precaution to ensure you could still pay for essentials, such as food and fuel, in an emergency.
How much cash is safe to keep at home?
As a rule of thumb, you should have enough cash to cover essential spending for two to three days. For smaller households, this might be around £100, while larger households or those living in rural areas might prefer to keep up to £300 at home.
However, Harriet Guevara, chief savings officer at Nottingham Building Society, warns against going overboard.
'Beyond concerns like loss or theft, cash held outside the banking system loses any potential for interest, isn't protected by the Financial Services Compensation Scheme (FSCS) and is often not covered in full by home insurance policies', she said.
Most home insurance policies only cover cash up to a limit, usually between £200 and £500, so check your policy to be sure. Anything beyond that won't be covered in the event of theft, fire or flood.
Sarah Coles, personal finance expert at Hargreaves Lansdown, also suggests having a broader backup plan.
She said: 'If you're worried about having access to your bank, it can make sense to have an arrangement with someone you are close to (and you trust) that you can call on in an emergency, and vice versa. In some cases, if you can't withdraw money, you can still transfer it.'
Where should you store cash at home?
Cash at home should be kept securely. Yet research from security site Safe.co.uk found that more than two-thirds (67pc) of people keep valuables, including cash, in storage that is not locked.
Anthony Neary, the company's security expert, said: 'Far too often, people are relying on obvious hiding places, such as inside drawers or cupboards, or even out on shelves, which offer little to no protection against opportunistic theft.
'Instead, use a secure storage solution such as a compact home locker or cash box with a lock.'
Storage should be fireproof as well as heavy or bolted to a wall so that it would be difficult to remove if someone broke into your home. It should also be stored out of sight, away from windows and doors, according to Vlatka Lake, of self-storage operator Space Station.
She said: 'Lofts are ideal because they are hard to reach and sometimes require ladder access. If you do go for this option, make sure to store the cash in a sealed container to avoid it getting damaged or mouldy. It should be stored in a dry but well-ventilated area.'
Whatever you do, don't keep your cash in a bedside drawer or under your pillows or mattress, as these are the first places intruders will check.
Ms Coles added: 'There are some traditional hiding spots where burglars will look first, like the freezer, the sock drawer and biscuit tins, so they're worth avoiding. If you have a lot of books, one option is to choose a book to hide it in. A burglar will run out of time looking for it.'
How else can I protect my access to money?
In addition to keeping some cash in hand, it may also be sensible to be prepared in case your bank experiences an outage.
Ms Cole said that some people will hold two current accounts for this reason, so that if one is inaccessible, they can still get hold of money deposited with a different bank.
Furthermore, the FSCS only guarantees your money up to £85,000 per person, per firm. So if your deposits are likely to go over the threshold, you should spread your money between accounts to ensure that you're protected.
Similarly, it is considered good practice to keep some of your savings in an easy-access account so it is on hand in case of emergencies. However, this money will not generate the same level of interest as accounts that require notice, so it's important to only keep what you need there.