FitzWilliam Financial Services

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Emergency Fund: easily accessible savings that can be used in cases of emergency like job loss, illness/injury, and more.
Goal: 3-6 months of expenses

ETF (exchange-traded fund): contains a "basket" of financial assets such as stocks, bonds, currencies, and more. ETFs trade on the market like regular stocks.

Mutual Fund: "an investment fund that pools money from many investors to purchase securities". Different from ETFs because mutual funds only trade once every day.

Why ETFs/Mutual Funds: an easy way to diversify your portfolio without actively managing individual stocks and they are less risky than investing in individual stocks.

Your 401(k) savings are deducted from your salary, and not taxed. These contributions also grow tax-free, and you only pay taxes when you withdraw.

*a 10% penalty will be added to the taxes due if you withdraw before 59 1/2 years old