Avoid Tapping Into 401(k) Early

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WAXHAW, NC – If you are facing a financial need, you may think about tapping into your 401(k). After all, it’s your money – why not use it?

For one thing, you’d be reducing the amount you have available when you retire. Also, withdrawals taken before you’re 59½ may be taxable and are generally subject to a 10% penalty.

Therefore, you may first want to explore some other options. For starters, you could look for ways to reduce spending. And if you’ve built an emergency fund containing a few months’ worths of living expenses, now might be the time to use it.

But if you encounter a financial crunch and you don’t have an emergency fund, you could look to your taxable investment accounts or a 401(k) loan. You might also consider other types of loans before withdrawing from your 401(k) or using credit cards extensively.

However, each of these options will have trade-offs, so discuss them with a financial professional before making any decisions.

In any case, do what you can to explore all your options before making a quick decision about your 401(k).

Member SIPC

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Dylan Hales
I'm a native North Carolinian, who grew up in the eastern part of the state. My folks exhibited and instilled many of the values that I still hold close to today. I had the opportunity to earn a bachelors from NC State, which is where I met my wife. We married shortly after she graduated in 2016. She grew up in this area, so we moved back to the Wesley Chapel area so we could be close to her family. Folks here have been more than welcoming and have made it feel just like home (minus the eastern NC BBQ).

People often ask what I like to do when I'm not at the office. That mostly depends on what time of year it is. During the spring and summer I like to work on my garden. During the fall and winter I love keeping up with NC State football and basketball. We also have two rescue dogs who like to explore the state with us.

Since I've been in Wesley Chapel, I've noticed that most folks just like me. We're all from somewhere and we've all come here following the things we love. I want to understand what those things are for you, and help get you there.