401(k) Borrowing Not (O)(K)
Our push – and your interest – in bringing an easy and fully automated retirement security program to fruition is to help Pennsylvanians prepare for their lives after work like they have never prepared before.
We want you to have a savings account that will supplement your Social Security and whatever other types of investments you develop along the way.
Yes, 401(k) plans can work, but a growing number of 401(k) savers are sabotaging their own retirements by borrowing from them while they are working.
In October, a study found 13 percent of 401(k) account holders had borrowed from their futures as a buffer against “a financial setback.”
Bad and unexpected things happen from time to time. Borrowing from your 401(k) to cover these costs makes the bad worse. When you borrow from your 401(k), you have to pay back that money.
Whichever legislative proposal for retirement security becomes law in Pennsylvania, policymakers must ensure that program participants’ money will be there for them – when they stop working for good.