Economic Charts

Shocking: 401K Plans Saw 40% Increase In Hardship Withdrawals

Updated: Jun 29, 2024 | Published: Jun 29, 2024
Verified Investing
By Verified Investing
Shocking: 401K Plans Saw 40% Increase In Hardship Withdrawals

Americans are struggling and the data continues to reinforce it. The latest stats show that there was a 40% increase in hardship withdrawals from 401K plans. This was largely due to savers struggling to keep paying their mortgages or afford rent. This data comes directly from Vanguard, one of the biggest retirement funds in the world.

While the hardship withdrawals have to be for a specific reason like paying rent or a mortgage, the underlying factors are much more widespread. Inflation has crushed people, credit card debt has surged over $1.15 trillion as the spending habits of the ‘good old days’ of Covid savings has continued in hopes of the ‘good times’ returning.

In addition, the job market has weakened substantially. While every month there has been an increase in hiring, the indepth analysis shows that full-time jobs have seen substantial losses while part-time jobs have surged. The surge in part-time jobs are people failing to find full-time work but also many taking multiple part-time jobs to avoid default.

The stock market is the last area standing and it will likely crumble sooner than later. Stay safe, my friends.