Why an Emergency Fund Is Your Financial Safety Net
Life happens when you least expect it – you could need a sudden car repair, a medical emergency could happen or anything. Having funds on hand gives you a cash cushion to soften the blow of unexpected expenses. Starting an emergency fund can feel overwhelming – so we are here to help guide you.
Let’s dive into the importance of an emergency fund, why a credit union is a smart financial choice and explore savings strategies:
Why is it important to have an emergency fund?
Having emergency savings not only gives you peace of mind but could eventually save you financially. By having a separate savings account, you know you have funds to dip into only when you need to. This helps avoid the sudden need for a loan and can save you a lot on interest.
How much emergency money should I save?
A good first step to emergency savings is making sure you have at least $1,000 on hand. This should help you in a pinch for some sudden expenses. The goal is to make sure you don’t have to open a loan to cover unexpected expenses.
Tip: Make sure to review your savings goals at least once a year. Expenses can change and if you receive a raise, make sure to put some of it into your savings.
What is the easiest way to build an emergency fund?
One of the easiest ways to set aside money for a rainy day fund is to do it automatically. With an automated savings account, your funds will build without having to think about it. A great way to do this is to have an account that rounds up the amount of your debit card purchases and deposits the difference between the actual purchase amount and the rounded-up amount in your account.
We offer our Rainy Day Savings account so you can meet your savings goals and earn high interest on amounts up to $1,000.
What should I look for in a savings account?
A good idea is to consider the minimum balance required and interest rate. Savings account interest rates vary, so find the best high interest savings account that meets your goals.
Some accounts require high deposit amounts or charge fees, which doesn’t work well for an emergency fund. If you choose an account with a required minimum balance, you won’t be able to withdraw the entire amount when you need the emergency funds. A great savings strategy is choosing the best savings account interest rate that still has no minimum balance required. Your money will grow while you enjoy life.
Should I open a savings account with a bank or credit union?
While both a bank and credit union can offer many different types of accounts, joining a credit union will give you more perks. Because credit unions don’t have shareholders, they return profits to members in the form of lower fees and higher savings rates.
When you’re a member of a credit union, you get more from banking than just great credit union savings rates. For example, members of Del-One FCU get all these benefits and more:
- Simplified savings solutions
- Reach your savings goals faster
- Competitive interest earnings
- Unlimited deposits and withdrawals in branch
- Online banking and eStatements available
- Friendly and attentive staff
How do I open an emergency savings account near me?
It varies between financial institutions. Del-One FCU makes it easy to open a Rainy Day Savings account and start your emergency fund.
Follow these steps or contact us today to get started:
- Become a member of Del-One FCU.
- Open a Rewards Checking account.
- Open a Rainy Day Savings account.
What are the perks of a Rainy Day Savings account?
This credit union savings account is unique. You will get one of the best accounts for rounding up purchases and great savings account interest rates. Here’s how it works:
- Make a purchase with your Del-One debit card and we’ll round up the amount to the next dollar.
- We will deposit the rounded-up amount into your Rainy Day Savings account.
- Your savings balance will grow with a high interest rate for balances up to $1,000.
A Rainy Day Savings account makes it easy to watch your savings grow every time you use your debit card with automatic transfers. Before you know it, you’ll meet your savings goal without even thinking about it.
What other types of banking savings accounts are there?
Once you finish saving for a rainy day, open accounts to accomplish all your savings goals. You can find plenty of credit union savings options to meet your savings plan. Here are some account offerings from Del-One FCU:
WINcentive® Savings Account:
Save AND receive entries for a chance to win cash prizes at the same time. The more you save, the better your chances are at winning.
Education Savings Account: Think ahead to your child’s future and open a Coverdell Education Savings Account (ESA). By setting aside funds early, you can lighten the cost of education further down the line. Plus, you can transfer funds without penalty to another member of the family.
Holiday or Vacation Savings Account: Open a savings account to make the holidays easier. Set money aside throughout the year to stuff stockings to the brim or book your dream cruise.
Want to learn more about the benefits of a savings account?
Del-One FCU offers educational content to help you learn about the best savings strategies and more. We’ve partnered with GreenPath™, to provide our members with free financial planning education and services, including:
- Educational webinars, articles and online courses
- Debt management services
- Financial counseling
- Credit report review
- And more
We’re here to help you save and gain financial security. Have more questions about budgeting for emergencies? Speak with a Del-One FCU representative today and we’ll be happy to assist you with your savings goals.
