How emergency savings works

What is Emergency Savings?

Emergency Savings is a protected account designed to help you build a financial cushion for unexpected expenses. It gives you peace of mind knowing you have funds available when life throws you a curveball.

• Instant access: Transfer to Cash immediately when you need funds

• Earns daily interest: Your money grows in the Allan Gray Money Market Fund

• Target tracking: Set a goal based on your monthly expenses and track your progress

• Protected account: Cannot be deleted, ensuring your safety net stays intact

Use Emergency Savings to cover unexpected expenses like medical bills, car repairs, home emergencies, or income loss during a job transition.

Why you need an emergency fund

An emergency fund protects you from financial stress when unexpected expenses arise. Without one, you might need to take on debt or sell investments at the wrong time.

Financial advisors typically recommend saving 3-6 months of essential expenses. This gives you enough runway to handle most emergencies without derailing your long-term financial plans.

What counts as an emergency:

• Medical expenses or health-related costs

• Car repairs or breakdown

• Home repairs (plumbing, appliances, roof)

• Job loss or reduced income

• Unexpected travel for family emergencies

What is not an emergency:

• Planned purchases (holiday, new phone)

• Regular bills or subscriptions

• Investment opportunities

Having a dedicated emergency fund means you can keep your investments working for you rather than cashing them out when life gets expensive.

How your money is invested

Your Emergency Savings is invested in the Allan Gray Money Market Fund (AGMF), a low-risk investment that earns daily interest while keeping your money accessible.

Think of it like a high-interest savings account, but with better returns. Your money is pooled with other investors and lent to banks and government institutions, earning interest that gets added to your balance every day.

What this means for you:

• Your balance grows daily through interest earnings

• You can withdraw anytime without penalties or notice periods

• Returns are typically higher than a traditional bank savings account

• Your money maintains its purchasing power against inflation

The investment strategy for Emergency Savings is fixed at 100% Allan Gray Money Market Fund. This ensures your emergency fund stays stable and accessible, unlike investment accounts where values can fluctuate.

Instant liquidity explained

Instant liquidity means you can access your emergency savings immediately when you need them. There are no waiting periods, penalties, or restrictions on withdrawals.

When you transfer money out of Emergency Savings:

1. The transfer to your Cash account happens instantly

2. Your updated balance appears immediately

3. From Cash, you can withdraw to your bank account

This is different from investment accounts like your TFSA or Investment Account, where selling holdings takes 2-3 business days to settle. Emergency Savings is designed for speed because emergencies do not wait.

Note: While transfers to Cash are instant, withdrawing from Cash to your bank account may take 1-2 business days depending on your bank.

Setting your savings target

A target helps you stay focused on building your emergency fund. Fynbos includes a calculator to help you determine the right amount based on your monthly expenses.

1. Navigate to Emergency Savings from your home screen

2. Tap Set up savings target (or Edit target if already set)

3. Enter your target amount, or use the calculator

Using the target calculator:

1. Enter your monthly expenses (rent, food, transport, utilities)

2. Select how many months of coverage you want (3-9 months)

3. The calculator multiplies your expenses by the months to suggest a target

Your target appears on your Emergency Savings account with a progress bar showing how close you are to your goal. You can adjust your target anytime as your circumstances change.

Tracking external savings

If you have emergency savings at another bank or provider, you can track them alongside your Fynbos savings. This gives you a complete picture of your emergency fund in one place.

1. Navigate to Emergency Savings

2. Tap the menu icon (three dots) in the Target card

3. Select Edit saved elsewhere

4. Enter the amount you have saved elsewhere

5. Tap Continue

Your progress bar now shows both your Fynbos savings and external savings, each in a different colour. External savings also count towards your target when automation rules run, preventing over-funding.

Note: Fynbos does not automatically sync with other providers. Update your external savings amount manually when it changes.

Adding money to Emergency Savings

You can add money to Emergency Savings in two ways: manual transfers or automation rules.

Manual transfer:

1. Navigate to Emergency Savings

2. Tap Transfer in

3. Select your Cash account as the source

4. Enter the amount you want to transfer

5. Tap Confirm

The transfer from Cash is instant. Your new balance appears immediately.

Using automation rules:

Set up a target rule to automatically fill your Emergency Savings when money arrives in Cash. The rule transfers just enough to reach your target, then passes remaining funds to the next rule.

1. Navigate to Automation rules from the main menu

2. Tap Add rule

3. Select Reach a target

4. Tap Continue

5. Choose Emergency Savings

6. Tap Confirm

This is the most effective way to build your emergency fund consistently without thinking about it.

Withdrawing from Emergency Savings

When you need to access your emergency fund:

1. Navigate to Emergency Savings

2. Tap Transfer out

3. Select Cash as the destination

4. Enter the amount you need

5. Tap Confirm

The transfer completes instantly. From your Cash account, you can withdraw to your linked bank account.

There are no penalties, fees, or waiting periods for withdrawing from Emergency Savings. The account is designed for exactly this purpose.