US. Millennials Are Making This Major 401(k) Mistake
Participating in an employer’s 401(k) plan is a good way to set aside funds for the future, especially if your company offers a generous match that helps boost your savings. But new data from investment banking company Natixis reveals that a large chunk of younger workers are making a major mistake on the 401(k) front: removing funds from their plans.
Specifically, 30% of millennials have taken out a 401(k) loan, while 26% have taken an early withdrawal. And the reason for doing so largely boils down to personal debt, with 40% of younger workers tapping their 401(k)s to tackle their outstanding obligations. If you’ve been thinking about cashing out part of your 401(k), or borrowing against it, to deal with financial issues you’re having, you should understand the consequences involved before you make a move you wind up regretting.
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