Should you dip into your 401K?
POSTED: Thursday, March 19, 2009 - 4:42pm
UPDATED: Wednesday, March 17, 2010 - 11:02am
LONGVIEW - For some taking money from your 401k is out of the question.
Paige Brewer of Longview said, "I have another 20-25 years to work so I would like for it to build as much money as possible so I can retire."
But there are people who in trying times would consider taking money from their retirement.
Tom Riley is a certified financial planner at RBC Wealth Management and he said, "We are seeing more and more people concerned about their finances and having to cut costs."
Despite tough times, financial advisors say taking money out of your 401k should be your last resort.
Riley said, "You always want to have 3-6 months of emergency funds cash on hand and that's to address times like this in a recession."
He said, "Cut your budget from the needs and wants and once all you're wants are out of there and you still can't make ends meet, there are provisions."
Riley says you can take money from your retirement under certain circumstances.
Like, funeral costs, college tuition, medical expenses, home repairs from a natural disaster and foreclosures.
Riley said, "We want to be sure people have exhausted all other options, any loans you can take on 401k before you take a hardship."