How to Make an Emergency Fund–and Protect Your Retirement Savings

An emergency fund can help you handle unexpected expenses without dipping into money you’ve set aside for long-term goals like retirement. Because if you suddenly lose your job, or your car breaks down, or you have to fix a leaky roof, you want to be able to continue paying for the necessities without threatening your overall financial wellbeing.

Here are 3 steps to make an emergency fund:

1) Set your goal amount: general guidelines suggest aiming to have 3-6 months’ worth of expenses. If you have dependents, your income is unpredictable, or you own your home (which may incur unexpected repairs), consider setting your goal more toward the higher end (6 months). Even in good times when you don’t have an emergency expense, how much you spend probably varies from month to month. So track your essential expenses for 3 months or so to get a picture of how much you tend to spend, on average, per month. Then you can multiply that number by 3-6 months to come up with your goal amount. Don’t stress about having the full amount saved immediately. Saving little by little can make a big difference.

2) Put money aside: automating your saving process may make it easier. By setting up automatic transfers from your main bank account to your emergency savings account, you won’t have to remember to keep moving those funds while you are building toward your goal amount. Auto transfer also helps decrease the mental and emotional strain of continually making the decision to save.

If you don’t already have 3-6 months’ worth of expenses available, you’re not alone. To fund your emergency account, look for realistic ways to increase the amount coming in or reduce expenses. For example, to earn more, maybe your hobby - e.g., dog walking or photography - can bring in a little extra cash. And to spend less, you might take small, habit-changing steps that are good for your wallet. For example, once per week, can you turn one of your regular drives into a carpool? For more ideas, check out the University of Connecticut’s list of 54 ways to save money.

3) Save in an appropriate account: keep these funds separate from the account you use for ordinary expenses. Look for an FDIC-insured account that lets you quickly withdraw money in an emergency. A checking account can work, but some other options may offer you a higher interest rate, which means your emergency fund could earn money even though it’s not invested in stocks or bonds. Consider a high-yield savings account, a money market account,* or a no-penalty certificate of deposit (CD). If you have an emergency and use money in your fund, try to begin rebuilding it as soon as you are able.

If you’re a Just Futures 401(k) or 403(b) client, you can use your Vestwell retirement account portal to open an emergency savings account in just a few clicks. Or, if you’d like to save through a mission-driven institution (MDI), community development financial institution (CDFI), or credit union, these databases may help you find options near you:

Database for MDIs and CDFIs.
Database for credit unions.

An emergency fund can help protect your long-term retirement savings. Taking money out of a retirement account early can mean losing not only the amount you withdraw, but also the potential future growth of that money.

~Lisa Akorli, Sales & Digital

*Money market accounts are FDIC insured. They are a bank deposit product. Money market funds are a securities investment, so they are not FDIC insured.

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Published August 28, 2026