PAWSOME
I’ve saved over £6,000 with an easy budgeting trick – it’s my emergency fund and better value than insurance
We explain the pros and cons of self-insuring
A DOG owner believes she has saved more than £6,000 thanks to an easy budgeting trick.
Daisy May Peberdy says not taking out an insurance policy for her golden Labrador has allowed her to build an emergency fund.
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The 26-year-old social media executive has been hit with several eye-watering vet bills over the years but using her savings to cover the costs has worked out cheaper than paying for insurance.
Daisy, who lives in Leicester with her partner, Matthew, 33, told The Sun: “As the owner of a dog which has a penchant for raiding the bins, I’m no stranger to visiting the vet.
"Over the years, I’ve often ended up with bills running into hundreds – if not thousands of pounds. I feel that self-insuring by saving for vet bills is better value than taking out pet insurance."
Self-insurance simply involves putting money into a savings account, rather than paying for pet insurance premiums.
Read more on saving
Some people prefer this option to forking out monthly – or annually – for pet cover.
Daisy and her partner got Dasher in 2020 and it didn’t take long for the bills to come rolling in.
"Dasher was a lockdown puppy,” she said.
“We’ve been besotted with him from the start, but he also comes with a hefty price tag.”
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She added: “We got him neutered when he was around 16 months old, and that was an operation that cost around £250.
"Unfortunately, due to complications after the procedure, Dasher had to go in for regular check-ups.”
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In the first year alone, the lab racked up costs of more than £1,000.
“To make matters worse, I couldn’t drive at the time,” said Daisy.
“This meant I had to either stump up the cash for taxis or rely on my dad for lifts – and find the money to pay him for petrol.”
At this point, Daisy realised she needed to have an emergency fund in place for Dasher.
“I didn’t want to pay for pet insurance as I’ve read reviews about policies not paying out on claims,” she said.
“For me, the idea of forking out monthly for insurance – and then the provider not paying out – is too high a risk.”
“I discovered a simple savings trick to help me manage the cost of vet bills,”
Daisy May Peberdy
Recent figures from ManyPets found the average cost of a vet consultation in the UK is £53.82, which does not take into account the costs of additional tests or medication.
There are fears that millions could be stumping up more than necessary on costly vet bills but insurance prices are also on the rise.
According to pricing consultants Pearson Ham, pet premiums rose by 13% in 2023 and new research from Go.Compare found that average annual premiums can cost up to £400.
For pedigree cats and dogs who are more prone to hereditary conditions, costs can soar to £700-£800 a year.
Pet insurance: everything you need to know
PICK YOUR POLICY: There are different levels of pet cover.
The more comprehensive policies offer higher payouts for a greater variety of conditions and are more expensive.
Basic cover is more affordable though you will have a cap on payouts for treatment.
UP THE EXCESS: Opting for a higher excess helps reduce insurance prices. The drawback is you have a sizeable cost to meet if you need to claim.
Keeping cash to cover this excess in an easy-access savings account is one way to offset the risk.
SHOP AROUND: Search for the best deal on policies using comparison sites — it’s worth checking multiple ones as many have exclusive offers with insurers.
Try GoCompare and CompareTheMarket.
SPENDING POWER: Once you have found a policy, buy it through a cashback app or website to get money back.
Even when buying through a comparison site, you can click through sites such as Quidco or TopCashback for cashback.
PRE-EXISTING CONDITIONS: Insurers will often refuse to pay for treatment for conditions your pet had before a policy is taken out.
Older pets are also more difficult to insure.
It could be better to stick with an existing policy if your cat or dog is elderly or has an ongoing illness.
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Budgeting trick
Daisy feels that self-insuring gives her more control.
“I would much rather know I’ve got money slotted away in savings,” she said.
“It’s simpler knowing exactly how much I have to cover vet bills. This system also means I have money to pay for things that wouldn’t be covered by pet insurance, such as taxi rides to the vet.”
For the past few years, Daisy has been using Monzo pots to keep some cash separate from the rest of her balance and has set up a 'pot' just for her dog.
“I have pots for various different savings goals – including one for vet bills,” she said.
“I contribute between £25 and £50 a week to the dedicated ‘Dasher’ pot, and end up with close to £2,600 a year.”
Slotting money away has helped Daisy stay on top of her finances, and save more than £6,000 for Dasher alone.
“It means I never get caught short when it comes to vet bills,” she said.
In the last four years, Daisy’s ‘doggy pot’ has come in useful multiple times.
“On one occasion, Dasher had to be rushed into the vet for eating an entire chocolate cake,” said Daisy.
“I was left holding a bill for more than £300.
"On another occasion, he ate leftover pizza dough which caused his stomach to expand. This cost me more than £600.
"Thanks to the pot, I’ve never had to compromise on my cheeky pup’s health.”
“You need to go in with your eyes wide open,”
Andrew Hagger
More recently, Dasher went to the vet for a standard appointment to get his claws clipped.
“This ended up costing more than £100,” Daisy said.
In addition to the ‘pots’ feature, Monzo customers can also ‘round-up’ money automatically, schedule regular deposits, and opt to take part in savings challenges to boost their pots.
“For the past two years, I’ve been contributing £2 to a pot each time it rains,” said Daisy.
This has totted up to £500 so far, on top of her fund for Dasher.
Aside from her dedicated ‘vet bill’ pot, having money squirrelled away in savings helps Diasy budget for the everyday costs associated with owning a pet.
“In the midst of a cost-of-living crisis, having money tucked away definitely helps,” said Daisy.
“We’ve really noticed the cost of pet essentials going up. A six-pack of dog food can now cost up to £9.”
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What are the pros and cons of self-insuring?
While self-insuring may sound appealing, it comes with both pros and cons.
Andrew Hagger, financial expert at Moneycomms.co.uk, said: “By self-insuring, you’re taking a gamble, but if you’re lucky and your pet doesn’t need any treatment then you could be quids in.”
“If you squirrel money away each month and don’t need to visit the vet for, say, 12 months, you’ll have built a decent balance,” he said.
“But there’s nothing to say you won’t suddenly face an emergency and need to cough up a four-figure sum for treatment.”
The older your pet gets, the more likely it is they may require treatment.
“You need to go in with your eyes wide open,” added Andrew.
“And if you do decide to go down the ‘self-insurance’ route, you must always keep the ‘vet fund’ money in separate accounts.
"This will help you avoid the temptation to spend it on something else.”
Are you eligible for help?
Organisations such as the Blue Cross and PDSA provide free vet treatment to sick and injured pets if their owners are on Universal Credit or other low-income benefits.
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Use the eligibility and postcode checkers on their websites.
Also check out Animal Trust (animaltrust.org.uk), a not-for-profit group which doesn't charge consultation fees, only fees for treatment or medication.
Alternative saving and budgeting options
HAVING an emergency fund can help you out with any unexpected costs, not just surprise vet bills - for example a car or washing machine breakdown.
An emergency fund can lessen the shock of needing to find money at short notice, especially as the cost of living crisis rages on.
Michael Royce, senior policy manager at the Money and Pensions Service, said: "Having an emergency fund also means you’re less likely to have to borrow when this happens.
“Credit is a very useful tool when used correctly. But if you don’t have savings you might rush into a decision without doing your research and picking the right product.”
Building up even a small amount could make all the difference.
He says: “Saving smaller, regular amounts is often more effective than saving larger amounts now and again. It gets you into the savings habit and you’re not overcommitting.
“It also lets you budget your spending from week to week or month to month more effectively.”
You don’t need a Monzo account, there are other simple ways you can put money to one side.
These include the ‘cash-stuffing method’ where you put actual hard cash into envelopes at the start of each week or month.
But bear in mind you won’t be able to earn interest.
A better option is likely to involve you transferring cash to a savings account on a regular basis.
Options include an instant access account, regular saver or cash ISA (individual savings account).
Remember to shop around for the best savings rates using a site such as Moneyfactscompare.co.uk.
Setting up a direct debit or standing order with a different account, so they money isn’t sitting alongside their normal household budget, is one of the easiest ways to get saving, says Micheal.
Other banks and apps offer similar features to Monzo for saving and budgeting, like Plum, Starling, Chip and Emma.
Some high street banks also offer these features as part of current accounts.
Borrowing cash should always be a last resort and you should always check you are getting all the help you are entitled to first.
If you don't have an emergency fund to fall back on though and do need to take out a loan, it is important to find the cheapest rate, so you don't end up racking up big interest charges that can add to your financial pressures.
Always make sure you read the terms and conditions, and understand the full amount you'll repay over the term of the loan - as well as any potential penalty charges or late fees.
Check out your options to access low-cost or even interest-free cash, in our guide.