Back in 2004, when I was 24 years old, my husband and I came into some money from my husband going TDY and then from the military giving us some money for moving expenses. We ended up saving about $10,000 all together and since at that point our emergency fund was in pretty good shape, we were looking for something else to do with the money. I ended up talking to the financial advisor at the bank and he told me I should start an IRA for my retirement. At first I thought he was crazy...I mean I was 24 after all! Then I started doing some research and I found out that if I contributed $4,000 a year for 10 years and then just left the IRA alone, that when I was 59 years old the $40,000 I had put in would have grown to about 1.5 million dollars! There is some risk involved, because the money is in the stock market, but the risk is pretty minimal because I have the money in a balanced fund. A balanced fund is a mixture of stocks and bonds, which makes it less risky...But you also don't have as much potential for a big return.
Since 2004, my husband and I have contributed $4,000 a year to our Roth IRA and now we have $20,000 invested. Some years it's been pretty hard to save the money to contribute, but we've always made it a high priority. It scares me to think about being old and poverty stricken...Unable to even afford air conditioning or medicine, which is what happens to a lot of people once they are too old to work. Also if we had to we could take out any of the money we've contributed without incurring a penalty, because we have a Roth IRA. That would of course be a last resort, but in a pinch, $20,000 would go a long way towards getting us back on our feet!
So once you have a fairly large emergency fund and you're looking for another way to save, I would recommend looking into a retirement account. We have ours with The Vanguard Group and so far I've been very happy with them.