retirement

Retirement raiders: More tap 401(k) early

Retirement at bay
Next
1 of 7
Retirement at bay

A lot of people want -- or need -- their 401(k) money now.

That's the clear conclusion from figures from Fidelity, the mutual fund giant that administers 11 million 401(k) accounts. As of the second quarter, 2.2 percent of Fidelity's 401(k) holders had made hardship withdrawals in the previous 12 months, even though these withdrawals carry a 10 percent penalty on top of taxes.

Meanwhile, a record 22 percent of Fidelity's 401(k) customers had outstanding loans against their plan.

We asked Bankrate's newsletter readers who were accessing 401(k) plans early -- in most cases you must wait until age 59½ -- or were borrowing against them, to tell us their stories. Their answers were unsettling, but insightful. Unemployment, financial emergencies and out-of-control credit card debts were among the most-cited reasons.

What about retirement? In today's economy, many of them say retirement planning is a luxury they can't afford.


 

 

advertisement

Show Bankrate's community sharing policy
          Connect with us
MORTGAGE HOME EQUITY AUTO CDs CREDIT CARDS
Product Rate Change Last week
30 year fixed 4.12%  0.06 4.18%
15 year fixed 3.25%  0.04 3.21%
5/1 ARM 3.48%  0.16 3.32%
 
View Rates in your area Next
Product Rate Change Last week
30K FICO-based HELOC 4.30%  0.01 4.29%
50K FICO-based HELOC 4.06%  0.02 4.04%
100K FICO-based HELOC 3.91%  0.02 3.89%
 
View Rates in your area Next
Product Rate Change Last week
60 month used car loan 2.79% --0.00 2.79%
48 month used car loan 2.99% --0.00 2.99%
60 month new car loan 3.23%  0.01 3.24%
 
View Rates in your area Next
Product Rate Change Last week
1 Year CD 0.97% --0.00 0.97%
2 Year CD 1.18%  0.01 1.17%
5 Year CD 1.81%  0.05 1.76%
 
View Rates in your area Next
Product Rate Change Last week
Balance Transfer Cards 15.75% --0.00 15.75%
Cash Back Cards 16.45% --0.00 16.45%
Low Interest Cards 10.96% --0.00 10.96%
 
Next
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

Blog

Jennie Phipps

How to love a reverse mortgage

Reverse mortgages are getting more respect now that retirees really need the money.  ... Read more

advertisement
Partner Center
advertisement

Connect with us