401(k) hardship withdrawals more common - MariettaTimes.com | News, Sports, Jobs, Ohio, Community Information - The Marietta Times

401(k) hardship withdrawals more common - MariettaTimes.com | News, Sports, Jobs, Ohio, Community Information - The Marietta Times: "Fidelity, which administers 17,000 plans representing 11 million participants, reported that in the same period a year ago, 45,000 workers made hardship withdrawals.

Local experts say this isn't a good idea, for a number of reasons.

'It certainly is a horrible idea,' said Randall Perry, a member of River City Financial Services LLC in Marietta. 'Prior to 59, there is a 10 percent IRS imposed penalty because the taxpayer or individual withdrawing the money is breaking an agreement with government.'

An individual must demonstrate an immediate and heavy financial need, according to IRS regulations, to be eligible for a 401(k) hardship withdrawal. This includes, among other things, certain medical expenses, burial or funeral expenses, and payments to prevent eviction or foreclosure on a primary home."

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