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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 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 3:32 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 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.
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