Your survival budget

Your survival number is the smallest amount you need each month. What goes in it, how to work it out, and what to use it for.

Your survival budget is the smallest amount you need each month to keep going. It takes about an hour to work out, and it sets your emergency fund target and your monthly headroom.

What a survival budget is

Your survival budget covers only the essentials: the roof, the heat, the food, the way you get to work, and the minimum payments on anything you owe. It leaves out streaming, eating out, holidays, new clothes and the gym. It is the minimum you would drop to for a few months if money became tight.

Be strict about the boundary. If stopping a payment would have a real consequence — losing your home, the lights going off, defaulting on a debt, being unable to get to work — it's survival. The usual list looks like this:

For a full household budget, see how to budget.

What the number is used for

×3three times your survival number is a realistic first emergency-fund target

How to work yours out in six steps

You need your bank statements and about an hour.

  1. Pull up the last two or three months of statements — every account the bills come out of, plus any credit cards.
  2. List every essential payment from the categories above: housing, utilities, food, transport, insurance, debt minimums, non-negotiables.
  3. Apply the test to each line: ‘if I stopped paying this, would there be a real consequence within a month or two?’
  4. Convert everything to a monthly figure. Annual bills (car insurance, MOT, breakdown cover) get divided by twelve.
  5. Add it up. That total is your survival budget.
  6. Write it down somewhere you'll find it — the notes app, the top of your budget, wherever.
Worked example — one household's survival number

Illustrative figures; yours will differ. A couple with a take-home income of £2,600 a month go through their statements and keep only what passes the test:

Rent£950
Council tax£140
Energy£120
Water£45
Broadband and two basic mobiles£45
Groceries£360
Transport to work£110
Car and contents insurance£60
Debt minimum payments£50
Survival budget£1,880 a month

Their monthly headroom is £2,600 − £1,880 = £720. Their first emergency-fund target is 3 × £1,880 = £5,640, rather than 3 × £2,600 = £7,800. And at £200 a month saved, the right target takes about 28 months to hit instead of 39.

What to do with the number once you have it

If there is a healthy gap between your income and your survival number, you can plan what the headroom goes on, such as an emergency fund, debt and goals; a proper budget covers how.

If the gap is thin, some survival costs can be reduced: energy, insurance, broadband and mobile are often overpaid, and cutting your bills covers them. A lower survival number frees up money each month and lowers your emergency fund target.

If your survival number is bigger than your income, get help: free debt advice from StepChange or National Debtline is available, and MoneyHelper has free guidance on maximising your income, including checking you're not missing benefits you're entitled to.

Survival numbers in coaching. Working out your survival number is one of the first steps in our coaching work, because so much hangs off it — the buffer you need, the risk you can take, the decisions you can afford. If you want to see where you stand across the whole picture, the free Financial Freedom Score takes about eight minutes and puts this number in context.

If your income is irregular

For the self-employed, freelancers and anyone on variable hours, the survival number matters even more, because your income varies but your floor does not. Each month you can check whether income covered the number. It also gives you a smarter way to pay yourself — many people with lumpy income pay themselves their survival number plus a margin as a flat monthly ‘salary’ from their business or holding account, and let the good months build up the buffer that carries the thin ones.

Updating it

Rent goes up, energy prices move, a loan gets cleared, a child arrives. Re-run the six steps once a year — or whenever something big changes — and update the figure. After the first time it takes about twenty minutes.

Questions and answers

Is a survival budget the same as an emergency budget?

They are related. Your survival budget is the number — what a bare-essentials month costs. An emergency budget is that number put into action: the spending plan you would switch to if your income dropped. Working out the number first is what makes the switch possible. Some people also keep a middle version — survival plus a small amount of sanity spending — for longer disruptions, since living at the absolute floor for six months is much harder than for six weeks. Start with the strict number; you can layer a ‘coping’ version on top later.

Should debt repayments count as survival spending?

The contractual minimums, yes. Missing even a minimum payment is reported to the credit reference agencies, can trigger default charges and, on some agreements, lets the lender demand the whole balance — all real consequences within a month or two, which is exactly the test for everything else on this list. Overpayments are different: they are a choice, not a contractual minimum, so they are the first thing to drop if money gets tight — one of the quickest ways to lower your number without missing a payment. If even the minimums don't fit inside your income once you've trimmed everything else, stop trying to make the budget work on its own and get free advice from StepChange or National Debtline before you miss one.

What if my survival number is higher than my income?

Then you have a deficit, and the fix is to work through three checks in order rather than panicking at the total. First, check the squashable essentials: energy, insurance, broadband and mobile contracts are the categories most households are quietly overpaying on, and cutting them lowers the survival number itself, not just spending around it. Second, check what you're entitled to: MoneyHelper's free benefits calculators catch support many households don't realise they qualify for, and it takes about ten minutes. Third, if debt minimum payments are what's sinking the sums, StepChange or National Debtline can often negotiate a lower payment or a formal arrangement, for free. Work through all three before assuming the gap can't be closed.

Do childcare and school costs count as survival?

Essential childcare — the hours that make it possible for you to work — absolutely counts, and for many families it's one of the biggest lines on the list. School lunches and transport count too. The judgement calls are things like clubs and activities: in a short, sharp emergency most would pause; over a longer stretch, some are worth protecting for your children's stability, so some families keep a ‘coping’ version of the budget alongside the strict one. The test is the same as everywhere else: what would have a real consequence if it stopped?

How often should I recalculate it?

Once a year as a routine, and immediately after any big change — moving house, a new baby, a cleared loan, a partner's income changing, or a jump in a major bill such as a mortgage renewal or an energy price rise. The first calculation is the slow one, because you're building the list from scratch; updates take about twenty minutes once the structure already exists, since you're only replacing the figures that moved. An out-of-date number is a quiet problem: it makes your emergency fund target too small and understates your real headroom. Some people pair the recalculation with an annual bill review, since both need the same statements open.

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