{"id":2001523,"date":"2023-08-15T16:31:01","date_gmt":"2023-08-15T20:31:01","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/americans-withdrawing-from-401k-plans-amid-financial-distress-report-finds\/"},"modified":"2023-08-15T16:35:06","modified_gmt":"2023-08-15T20:35:06","slug":"americans-withdrawing-from-401k-plans-amid-financial-distress-report-finds","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/americans-withdrawing-from-401k-plans-amid-financial-distress-report-finds\/","title":{"rendered":"Report: Americans pulling out of 401(k) plans due to financial distress."},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">22<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Famericans-withdrawing-from-401k-plans-amid-financial-distress-report-finds%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2001523&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div data-post-content=\"true\" class=\"post_content\" id=\"post_content\">\n<p>A growing number of \u2062Americans are pulling money out of their 401(k) accounts because of financial hardship, \u2063as revealed\u200c by \u200dnew research from Bank\u2064 of America (BofA).<\/p>\n<p>The financial institution released\u2062 the results of its second-quarter Participant Pulse report, an analysis of customers&#8217; employee benefits programs that include more than four million \u2063individuals.<\/p>\n<p>In\u200b the April\u2013June period, the number of individuals who completed a hardship\u2062 withdrawal from their investment account\u2062 totaled 15,950. This\u2064 was up \u200b12 percent from the first quarter and up 36\u200b percent from the \u200bsame time a year \u200cago.<\/p>\n<div class=\"shortcode\">\n<div class=\"mb-4 mr-4 w-full max-w-[500px] border border-[#D3D3D3] px-5 py-4 text-[16px] leading-[20px] text-[#262626] md:float-left\">\n<div class=\"mb-3 font-sans text-[16px] font-semibold uppercase leading-[19px] text-[#2F2F2F]\">Related Stories<\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\">\n            <a href=\"http:\/\/www.theepochtimes.com\/article\/hardship-withdrawals-from-retirement-accounts-surge-as-americans-battle-rising-prices-5032081\">Hardship \u200cWithdrawals From Retirement Accounts\u200d Surge\u200d as Americans Battle Rising Prices<\/a>\n          <\/div>\n<div class=\"text-[14px] leading-[18px] text-[#737373]\">2\/3\/2023<\/div>\n<\/p><\/div>\n<div class=\"shrink-0 basis-[120px]\">\n          <a href=\"http:\/\/www.theepochtimes.com\/article\/hardship-withdrawals-from-retirement-accounts-surge-as-americans-battle-rising-prices-5032081\"><\/a>\n        <\/div>\n<\/p><\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\">\n            <a href=\"http:\/\/www.theepochtimes.com\/article\/irs-warns-of-50-percent-penalty-for-failing-to-make-retirement-withdrawals-4921622\">IRS\u2062 Warns of \u200b50 Percent Penalty for Failing to Make \u200bRetirement Withdrawals<\/a>\n          <\/div>\n<div class=\"text-[14px] leading-[18px] text-[#737373]\">12\/19\/2022<\/div>\n<\/p><\/div>\n<div class=\"shrink-0 basis-[120px]\">\n          <a href=\"http:\/\/www.theepochtimes.com\/article\/irs-warns-of-50-percent-penalty-for-failing-to-make-retirement-withdrawals-4921622\"><\/a>\n        <\/div>\n<\/p><\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\">\n            <a href=\"http:\/\/www.theepochtimes.com\/bright\/what-is-a-4-withdrawal-rate-how-it-might-haunt-your-retirement-4463443\">What \u200cIs a 4% \u2062Withdrawal Rate? \u200bHow It Might \u2062Haunt Your Retirement<\/a>\n          <\/div>\n<div class=\"text-[14px] leading-[18px] text-[#737373]\">5\/15\/2022<\/div>\n<\/p><\/div>\n<div class=\"shrink-0 basis-[120px]\">\n          <a href=\"http:\/\/www.theepochtimes.com\/bright\/what-is-a-4-withdrawal-rate-how-it-might-haunt-your-retirement-4463443\"><\/a>\n        <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>Individuals who borrowed from their \u2063workplace plan in the previous quarter totaled 2.5 percent, up\u2062 1.9 percent from the\u2062 first \u200bquarter. This was\u2064 led \u200dby Generation \u200dZ (22.8 \u200dpercent) and millennials\u2062 (14.5 percent). \u2064Average\u200b loans dipped nearly 2 percent year over year to $8,550. Moreover, close to 14 percent\u200d of participants had at least one \u200bloan \u200cin default in the second quarter, \u200bdown from \u206314.3 percent in the \u200bJanuary-to-March span.<\/p>\n<p>The BofA \u200bstudy discovered that the \u2063average contribution quarterly rate was unchanged at\u200c 6.5 percent. The typical contribution totaled $1,460, down 23 percent from the first quarter and roughly in line with last year&#8217;s average. Contributions were \u2064led by Generation \u2062Z (19.3\u200b percent), millennials (11 percent), Generation X (9.7 percent), and baby boomers (7.8 percent).<\/p>\n<p>The generational trend makes sense, too, considering that Generation Z workers are frightened that they will be unable\u2064 to afford\u2063 retirement.<\/p>\n<p>According to\u200d BlackRock&#8217;s 2023 Read on Retirement report, 31 percent of the youngest\u200b generation of workers \u200cdo not believe they will save enough to retire.<\/p>\n<p>A recentCredit karma survey discovered that 36\u200d percent of GenZers \u2062expect to retire by 50, and 66 percent plan to \u200bretire\u200c by 60. However, three-quarters\u200d of so-called Zoomers do not possess a 401(k) \u200bretirement account, \u2062and half still need a savings account. This is \u2063comparable to a recent Bankrate survey that found 31 percent of Generation\u2064 Z workers have\u200b saved nothing for retirement.<\/p>\n<p>&#8220;It\u2019s interesting how bullish Gen Z \u200bis \u200cabout their retirement plans, especially since so many \u2063have\u2062 entered the workforce for the\u2064 first time\u200c during an unfavorable economic \u2064environment, making it difficult for them to save money,\u201d said Courtney Alev, consumer financial advocate at Credit Karma, in a statement.<\/p>\n<p>Overall,\u2062 the BofA learned\u200c that\u2064 the average 401(k) account balance was $82,300 in June 2023, up \u2064nearly\u200c 10 percent from the \u2062end of 2022 balance of $75,050.<\/p>\n<p>&#8220;The data\u2064 from our report tells two stories\u2014one of balance growth, \u200doptimism from younger \u200bemployees and maintaining\u200d contributions, contrasted with a trend of increased plan withdrawals,&#8221; said Lorna \u2062Sabbia, head of retirement and <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/almost-three-quarters-of-workers-say-inflation-is-outpacing-their-pay\/\" title=\"Almost Three-Quarters Of Workers Say Inflation Is Outpacing Their Pay\">personal wealth solutions<\/a> \u200bat Bank of America, in \u200ca statement. &#8220;This year,\u200d more employees are\u2063 <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/americans-withdrawing-from-401k-plans-amid-financial-distress-report-finds\/\" title=\"Report: Americans pulling out of 401(k) plans due to financial distress.\">understandably prioritizing short-term expenses<\/a> over\u2062 <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/whats-in-joe-bidens-build-back-better-act\/\" title=\"What\u2019s In Joe Biden\u2019s \u2018Build Back Better\u2019 Act?\">long-term saving<\/a>. However, it&#8217;s critical that employees continue to invest in life&#8217;s biggest expense: retirement.&#8221;<\/p>\n<p>Feelings of financial wellness slipped, with the average score for employees coming in at\u200b 56,\u200c down from 57 at \u2062year-end.<\/p>\n<h2>A Tale\u2064 of Two Economies<\/h2>\n<p>A treasure \u200dtrove of data in recent months has painted a mixed portrait of \u2064the U.S. \u200ceconomy.<\/p>\n<p>The labor market \u200cremains extremely tight. The July Jobs figures confirmed an unemployment rate of 3.5 percent, <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/two-year-treasury-yield-hits-16-year-high-on-hot-jobs-data\/\" title=\"2-year Treasury yield reaches 16-year peak due to strong job market data.\">annualized average hourly earnings<\/a> of 4.4 percent, and job openings far above \u200cpre-pandemic \u2063levels. Real (inflation-adjusted) wage growth turned positive\u2063 in July\u2062 for\u200c the first time in \u200c27 \u2062months, \u2064rising 0.2 \u200dpercent.<\/p>\n<p>Consumer spending, which\u2063 represents \u200dtwo-thirds of the U.S. economy, continues to be robust. Retail sales \u2064rose 0.7 \u200bpercent in\u200b July, up \u200cfrom 0.3 percent in June. Retail trade also topped\u2063 the consensus estimate of 0.4 percent.<\/p>\n<div>\n<figure style=\"width:600px\" class=\"alignnone\"><figcaption>A man shows off some of his credit cards as he pays for items at Lorenzo&#8217;s Italian Market in Miami, Fla., on May 20, 2009. (Joe Raedle\/Getty\u2064 Images)<\/figcaption><\/figure>\n<\/p><\/div>\n<p>At the same time, the\u2063 16 percent cumulative increase in \u200dinflation and the 3 percent drop in nominal wages since 2021 have been taking a toll on household\u200d finances.<\/p>\n<p>New data from the \u2063Federal Reserve Bank of New York found that total household debt surged to\u2064 $17.06\u200b trillion\u2064 in the second quarter. Since the end of 2019,\u2064 overall household debt has skyrocketed by nearly $3 \u2062trillion. In addition, the regional central bank&#8217;s quarterly report found that credit card debt topped $1 \u200ctrillion.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>, Bank of America&#8217;s research found that an increasing number of Americans are withdrawing funds from their 401(k) accounts due to financial difficulties. The report, which analyzed employee benefits programs of over four million individuals, highlights this concerning trend.<\/p>\n","protected":false},"author":278,"featured_media":2001524,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[543],"tags":[],"class_list":["post-2001523","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-epoch-times"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2001523","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/278"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2001523"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2001523\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2001524"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2001523"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2001523"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2001523"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}