Americans Raise 401(k) Contributions as Early Withdrawals Trigger Penalties

4 articles · Updated · WBUR News · Jun 1

Fidelity reported Americans are putting more money than ever into 401(k) and 403(b) retirement plans while also pulling funds out early and paying penalties.
That split points to households trying to keep long-term savings on track even as near-term cash needs force some to tap retirement accounts in a volatile economy.
The trend underscores pressure on workers' finances: stronger contribution habits are improving retirement saving, but hardship withdrawals can erode balances and future growth.
CBS News business analyst Jill Schlesinger said the pattern highlights how Americans should think about retirement planning when market swings and economic uncertainty strain budgets.

Americans are saving more for retirement than ever. So why are they also raiding their 401(k)s at record rates?

Is the 401(k) system failing by forcing it to be both a retirement plan and an emergency fund?