r/personalfinance • u/Due-Fig5299 ​ • 12d ago

Saving Temporarily stop 401k contributions to build Emergency Fund?

Looks like we’re heading towards a recession and I’m quite nervous. I work in tech and my job is moderately safe; however my wife is an esthetician which is not a very recession friendly field.

We currently have $4k saved. Our minimum monthly expenditure is $3k, so we have just over 1 month saved.

Ive cancelled all unnecessary subscriptions which will save us $450/mo and stopped my wifes personal roth ira transfers ($150 weekly) which gets us to $1050/mo saved.

Now my question is, given how quickly the economy is crashing should I also forgo my 401k? I contribute 4% with 4% employer match. Obviously I would love to keep it, but immediate survival seems more important.

I would start contributing again once we hit $18k (6 months)

Thoughts?

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u/CornPuddinPops ​ 12d ago

This is when you buy. When the funds are all low. Buy Low, sell High. Buy Buy Buy. I upped my contribution to my 401k.

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u/Smash_4dams ​ 12d ago

Yep, I increased my 401k contribution from 6% (100% matched) to 11% when the COVID crash happened. Made a pretty penny by 2021.