A record number of Americans took money out of their 401(K) plan last year for a financial emergency, stark new figures reveal. Data from Vanguard Group, one of the largest US retirement plan providers, reveals 3.6 percent of participants took early withdrawals from their accounts in 2023. In 2022, around 140,000 - or 2.8 percent of participants - took emergency withdrawals from Vanguard 401(K) accounts. A 401(K) loan is overseen by a participant's plan, and lets them borrow money from their retirement savings and then pay it back over time with interest. Although increasing numbers of Americans are being forced to take money from their retirement savings, the average 401(K) balance also increased last year.

Source: Wall Street Journal March 12, 2024 12:26 UTC