- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
1 in 4 401k's being raided for use on current expenses-WAPO article
Posted on 1/15/13 at 1:49 pm
Posted on 1/15/13 at 1:49 pm
The only one benefiting is the plan administrator. More a case for means testing, which will again reward negative behavior.
quote:
More than one in four American workers with 401(k) and other retirement savings accounts use them to pay current expenses, new data show. The withdrawals, cash-outs and loans drain nearly a quarter of the $293 billion that workers and employers deposit into the accounts each year, undermining already shaky retirement security for millions of Americans.
quote:401k Breach
“Encouraging or enabling people to spend down retirement money in anything other than the most severe circumstances is a terrible mistake,” said David C. John, a senior fellow at the Heritage Foundation who studies retirement policy.
4
Posted on 1/15/13 at 2:12 pm to StrangeBrew
Not shocked at all. Clients call in all the time wanting to do this with their accounts (not just 401(k)'s). It is a terrible trend.
Posted on 1/15/13 at 2:58 pm to GoCrazyAuburn
I'm not shocked either. A family member had a "mid life crisis" of sorts and drained their 401k. They haven't contributed a dime since and are 50 years old right now. 
I don't even consider my 401k as an option for anything unless it became the most severe of situations. Even then I'd think twice.
Plus a lot of the people I work with are paying back their 401ks right now. They think it's just a glorified savings account they can dip in to when they feel like it. There is a major lack of financial education in this country.
I don't even consider my 401k as an option for anything unless it became the most severe of situations. Even then I'd think twice.
Plus a lot of the people I work with are paying back their 401ks right now. They think it's just a glorified savings account they can dip in to when they feel like it. There is a major lack of financial education in this country.
This post was edited on 1/15/13 at 3:00 pm
Posted on 1/15/13 at 3:02 pm to GoCrazyAuburn
Tex
Posted on 1/15/13 at 3:08 pm to Broke
Huh?
Posted on 1/15/13 at 3:28 pm to StrangeBrew
Seems to me to be an income problem that just happens to lead to a retirement problem.
Posted on 1/15/13 at 3:30 pm to foshizzle
Or just a spending problem.
Posted on 1/15/13 at 3:32 pm to StrangeBrew
My mother did it, got killed. I wish she had to come to me first, I'd have given her the money if things were that bad.
But my mother is a financial retard, she was gonna a Pay Day loan to make sure she had enough money for Christmas, thank god I was there and had cash on hand.
But my mother is a financial retard, she was gonna a Pay Day loan to make sure she had enough money for Christmas, thank god I was there and had cash on hand.
Posted on 1/15/13 at 3:35 pm to weaglebeagle
quote:
I don't even consider my 401k as an option for anything unless it became the most severe of situations
This. And even in that situation, I would probably just reduce the contribution amount to help pay things off. I guess the only way I would ever spend money out of it is if somehow my wife and I both lost our jobs for 6+ months.
Posted on 1/15/13 at 4:19 pm to KG6
quote:
I guess the only way I would ever spend money out of it is if somehow my wife and I both lost our jobs for 6+ months.
And even then I would work at McDonalds or bag groceries before I would cash in the 401k.
Posted on 1/15/13 at 4:33 pm to Sigma
quote:
And even then I would work at McDonalds or bag groceries before I would cash in the 401k.
This.
Posted on 1/15/13 at 4:35 pm to Sigma
Man, why can't some of my clients be more like you guys 
Posted on 1/15/13 at 5:10 pm to jmtigers
quote:
And even then I would work at McDonalds or bag groceries before I would cash in the 401k.
This.
pretty much this, although if I can't find a job in 6 months the economy is in really terrible shape. Unemployment in my industry is sub 5%, probably closer to 3%.
And honestly if you are only using your 401k for savings, you are going have a bad time.
Posted on 1/15/13 at 5:40 pm to buddhavista
I'll also note that probably most people in this situation don't have nearly enough saved to start with even if they didn't raid the account.
Posted on 1/15/13 at 7:21 pm to foshizzle
Being chronically unemployed would ultimately lead me to withdraw, but it would only happen after I instituted an austerity program like no other.
Posted on 1/15/13 at 7:31 pm to GoCrazyAuburn
quote:
Man, why can't some of my clients be more like you guys
Well if they all spent their free time researching ways to obsessively save money and plan their personal financial futures they probably wouldn't need you!
Posted on 1/15/13 at 10:16 pm to StrangeBrew
It's a stupid rule allowing you to borrow 401k money from your account without penalty. I was told one time the rule is there to encourage lower-income people to use 401k's. I don't believe it.
It's there for the benefit of plan administrators.
It's there for the benefit of plan administrators.
Page 1 of 1
Popular
Back to top
Follow TigerDroppings for LSU Football News