Record number of Americans tapping retirement savings early, financial advisor warns of consequences

MILWAUKEE (CBS 58) -- Six percent of workers enrolled in 401(k) plans managed by Vanguard made a hardship withdrawal last year, marking the sixth consecutive year of increases since 2018, according to Drake & Associates.

Tina Alfini of Drake & Associates joined us on Wednesday, April 22 to explain the risks and outline alternatives including 401(k) loans, emergency savings funds and home equity lines of credit for those facing financial hardship.

Withdrawing before age 59-and-a-half typically triggers taxes on the amount as regular income plus a 10% penalty, though the Secure Act 2.0 reportedly allows up to $1,000 to be withdrawn penalty-free for emergencies every three years.

Learn more by contacting Drake & Associates here.