Here's How Much Savers Withdrew From Retirement Plans During the Pandemic
Millions of Americans have been impacted financially during the coronavirus pandemic. Some have seen their savings increase as a result of work and lifestyle changes, while others have seen their income decline to a dangerous extent.
If you landed in the latter camp, you may have needed to take an early withdrawal from your retirement plan to make ends meet. The CARES Act, which was signed into law in late March, allowed for up to a $100,000 penalty-free withdrawal from an IRA or 401(k) for those impacted by the pandemic. And new data from Vanguard shows that some savers took advantage of that option.
In fact, an estimated 4.5% of Vanguard 401(k) savers took a coronavirus withdrawal between March and September, and among them, the median withdrawal amount was $12,000. On the one hand, a $12,000 withdrawal isn't awful if you consider that savers have the option to remove up to $100,000. On the other hand, even a $12,000 withdrawal could have negative impacts on retirement down the line.
Source Fool.com
