Regardless of the number of petitions signed, the prospects for a fourth stimulus check appear dim. Is it okay to use your retirement savings with no stimulus check on the horizon?
Should You Use Your Retirement Savings If You Have No Incoming Stimulus Checks?
That’s if you have no other options. Stimulus checks have no political support in the GOP. Use your retirement savings if the following conditions are true:-
- You have no other way out.
Using money from your retirement account can have serious consequences that can affect you later. Before withdrawing money from your savings, consider these options instead:
Getting an APR credit card can help, but be sure to balance the credit before the rate expires.
Hustle to the side.
Hold a yard sale for things you no longer need or use.
Adjust your budget to the money available.
You should consider short-term solutions that will not affect your distant future. However, if you have no means available, you have no choice but to use your retirement savings.
- Expenses are very important.
Use your retirement savings for critical expenses such as foreclosure, medical care, repossessing your vehicle, or keeping other serious situations at bay. Don’t waste your savings on things that won’t have any long-term consequences.
- You understand the consequences of dipping into your retirement savings.
Early withdrawal of your retirement savings before age 59 will result in a 10% deduction. You will lose 1/10th of your savings on the spot. If you cannot return the money, you will also lose on returns. You can reduce your losses by checking if you are eligible for difficulty penalties. It will allow you to tap into your savings without penalties.
Your employer may allow you to borrow money from your 401(k). But if you can’t repay the money on time, it will be considered a loan. You will lose interest during the indemnity period. If you understand the consequences and you have no options available to you, then by all means go for it.