As the plan administrator for my company’s 401K I have a window seat into all the activity for our 401K plan. What I’ve seen over the past year is a flurry of individuals taking out loans. Some individuals literally pay off a loan one week and begin another loan the following week, never giving their retirement accounts a chance to recover. It turns out that this is a wider trend happening all over the country. Individuals are raiding their retirement plans to pay for their current debts.
NBC news did a story on this trend in the video below.
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