401k Drained Due to COVID-19

401k Drained Due to COVID-19

(FinancialHealth.net) – The coronavirus outbreak is devastating the American workforce. More than 30 million people have lost their jobs in the US over the last couple of months. Some of them have had to withdraw a substantial amount of money from their retirement funds to survive the pandemic.

In March, Congress passed the CARES Act to help Americans get through the COVID-19 crisis. The bill contained more than $2 trillion in aid and allowed workers to take up to $100,000 out of their 401(k)s without forcing them to pay a penalty. People who take money out of their retirement funds will be able to pay the taxes on the money over 3 years.

Of course, any time you have to take money out of your retirement fund, there is some anxiety. Will you have enough to retire? Can you afford the taxes? Will you ever recover?

If you take a conservative approach with your money over the next few years, you can get through this. Financial expert Peter Dunn says people who withdraw funds from their 401k accounts need to remain focused on cutting their expenses, tax-planning and long-term investing. Making good decisions is how everyone will begin to recover from the COVID-19 mess.

~Here’s to Your Financial Health!

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