More Americans Are Making This Dangerous 401(k) Move
Without savings in an individual retirement account (IRA) or 401(k), you might have a really hard time keeping up with your living costs once you retire and your paycheck disappears. So it's good to learn that as of August, 401(k) balances had increased by $7,250 since the end of 2022, according to data from Bank of America.
That same report, however, found that 401(k) hardship distributions increased 36% on a year-over-year basis. And that's a not-so-favorable statistic.
Some 401(k) plans allow savers to take hardship withdrawals to cope with things like medical bills and unemployment. And it can be tempting to tap your 401(k) plan when unexpected expenses arise. After all, that money is yours, and it's just sitting there. Why apply for a loan when you have savings you can raid?
Source Fool.com
