Emergency Savings with Vestwell: Building a More Connected Savings Experience

How embedding a free Emergency Savings Account directly beside the 401(k) in a single, frictionless view turned passive participants into active savers.

The problem

Saving for emergencies is hard, and disconnected savings make it harder. Most American workers can't absorb an unexpected expense, so without a cushion, they lean on high-interest debt or raid their 401(k) early, forfeiting decades of compounding growth. Emergency savings isn't a new idea, but the way employees access it is broken: short-term and long-term savings live in separate places, behind separate logins, with separate setup friction.

Research confirms emergency savings are foundational to financial wellness. Vanguard found they were the strongest predictor of financial well-being among 12,400+ investors. BlackRock found employees with inadequate emergency savings were 13X more likely to take a hardship withdrawal, while those with savings were 70% more likely to contribute to retirement. Fidelity found emergency savings ranked as employees' top savings priority after retirement, reinforcing the link between short-term resilience and long-term retirement security.

What Vestwell did

Vestwell put short-term and long-term savings side by side, in one view, introducing a free Emergency Savings Account directly within the workplace retirement portal.

Eligible savers could:

• Activate an ESA without leaving their retirement account
• Link an external bank account
• Set a savings goal
• Schedule recurring deposits
• Access funds without withdrawal penalties
• Earn interest on their emergency savings

Vestwell also embedded the ESA into its self-service plan-purchase flow, allowing prospective employers to see emergency savings as an included component of the broader workplace savings offering.

This approach reduced the number of steps required to begin saving and introduced emergency savings within an existing, high-intent financial environment.

Benefits

One experience for today’s needs and tomorrow’s goals

• Lower friction.
  • Built into the portal that employees already use.
• No additional cost to employer or employee.
  • Included in Vestwell’s fees for retirement plan recordkeeping
• Savings, reinforced.
  • Emergency savings drives retirement engagement, and similarly, retirement prompts ESA.
• Business differentiator.
  • A bundled feature that strengthens employer recruiting, retention, and plan sales.

Early results

Removing friction produced immediate, accelerating action.

ESA registrations grew 8X, representing a 697% increase from Vestwell’s beta population.

Funding activity also accelerated. Total ESA assets grew at an average compounded daily rate of 12.9%, with recurring deposits indicating that savers were moving beyond registration and beginning to build active financial cushions.*

The integrated offering also influenced employer behavior. Prospective plans shown a built-in ESA banner within Vestwell’s self-service purchasing flow converted at 1.5X the rate of plans that did not see the ESA message.**

These early results support a central conclusion: making emergency savings visible, integrated, and easy to activate can influence both individual saving behavior and employer plan adoption.

Looking ahead

Vestwell is continuing to evaluate whether integrated emergency savings lead to higher retirement contribution rates, stronger retirement balances, and fewer premature withdrawals over time.

The early evidence indicates that the architecture of the savings experience matters. When employees can manage immediate financial needs and long-term goals in one place, saving becomes more cohesive, accessible, and actionable.

*Based on Vestwell internal data

**Based on an A/B test of Vestwell's self-service plan purchasing flow (Heap), Jan 29 – April 7 2026: 4.2% of 477 prospective plans shown the ESA banner converted, vs. 2.7% of 222 not shown the banner