A retirement fund (like a 401k) is a common way to plan for the future, but it’s not the only way to save!
2 minute read
Financial security isn't just about planning for the future, it's also about being prepared for the unexpected.
Life has a way of throwing curveballs when you least expect it: a busted water heater, a sudden dental emergency, a car breakdown in the middle of a winter storm. Unforeseen expenses can disrupt even the most meticulously planned budgets.
Enter the versatile emergency fund—a financial safety net ready to rescue you from unforeseen hurdles without tapping into your retirement savings. Here we'll explore the benefits of having an accessible emergency fund, and how you can get started on yours today.
When we think about traditional financial benefits, the most likely benefit that comes to mind is the 401(k), which is a personal savings account used to build up money for retirement over time. With a traditional 401(k) offered by your employer, part of your paycheck is automatically contributed to your retirement savings each pay period.
But there are other ways to save, too. It’s just as important to prepare for unexpected expenses in the shorter term as it is to prepare for retirement. That’s where an emergency fund comes in.
Whether it’s a flat tire or unexpected medical bill, emergency funds can get you out of a tight spot, without having to borrow money or dip into your retirement savings.
An emergency fund can be kept anywhere, like that metal lockbox in your closet. But there are some distinct benefits to keeping your savings in a FDIC-insured bank account:
Some employers will even help you supercharge your emergency fund!
When you use an employer-sponsored financial wellness partner like Exhale to set aside part of your paycheck for savings, you get a boost on the money you save.
For each boost period in Exhale—if you consistently make contributions to your Exhale deposit account—you're eligible for a bonus at the end of the period. This bonus is unique to Exhale and not offered with a traditional 401(k) program.
While retirement savings can be beneficial for people at certain stages of life, anyone can benefit from an emergency fund.
Both types of saving can offer rewards, so remember to review the fine print and ask your employer if you have questions.
Not sure if your employer uses Exhale? Check out exhalefi.com or ask your employer.