Category: hardship withdrawals

American Citizens’ 401(k) Accounts Lost a Fifth of Their Value in 2022

June 16, 2023
401(k) withdrawalBusiness & Marketseconomyhardship withdrawalsMarketspersonal financerecessionstocksUSUS News
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The balances of 401(k) retirement accounts have declined in 2022, with the share of participants who are making “hardship withdrawals” hitting a “new high,” according to a recent report by investment firm Vanguard. “In 2022, the average account balance for Vanguard participants was $112,572; the median balance was $27,376. Vanguard participants’ average account balances decreased…

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Should You Tap Your 401(k) When Urgent Financial Needs Arise?

March 29, 2023
401kBrightbudgetingDebt Managementearly withdrawalFuture Planninghardship withdrawalspersonal financeretirementtaxWealth Managementwithdrawal
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Shortly after COVID-19 started and many people lost their jobs, the government permitted penalty-free 401(k) withdrawals for people short on cash. There was a limit to the withdrawal of $100,000, which had to be paid back within three years—if it was to remain penalty-free. Many people took advantage of the opportunity, but hindsight asks whether…

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Hardship Withdrawals From Retirement Accounts Surge as Americans Battle Rising Prices

February 3, 2023
401kBusiness & Marketseconomyfinancial hardshipshardship withdrawalshigh inflationpersonal financerecessionretirement savingsUS
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Last year, a higher proportion of Americans with 401(k) accounts carried out hardship withdrawals—emergency removal of funds from a retirement plan—as many people financially struggled under decades-high inflation rates. “A record 2.8 percent of the 5 million people in 401(k) plans run by Vanguard tapped their retirement savings in 2022 to cope with hardships such…

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