Pocketbook to Piggy Bank: More Raiding Retirement

The coronavirus pandemic has already cost millions of people their job, and now it's threatening many people's retirement. A new survey from MagifyMoney says nearly half of Americans have either already raided their retirement account due to the pandemic or plan to do so. Of those who have taken funds from their retirement in the last two months, more than 1 in 4 said it was due to job loss.

The recently-passed $2 trillion coronavirus relief package removes the early withdrawal penalty on up to $100,000 from retirement accounts through the end of the year, for coronavirus-related expenses. That provision has encouraged more people to tap their retirement savings, even as financial planners caution against doing so unless it is an emergency.

What it means is those threatened the most physically by coronavirus--older Americans--are also threatened financially by the pandemic. "Forty percent of those over the age of 50 are still working, many of them run their own businesses," says Robert Charles with the Association of Mature American Citizens (AMAC). "And they never dreamed they would be pushed out of business essentially by a government mandate and a pandemic, and have to draw on their 401(k)s and retirement accounts."

Charles and AMAC are calling on Congress to take further action to protect Social Security and retirement savings for older Americans. "Most older Americans don't want something for nothing, but they feel they have worked hard and they want to retain the savings they have worked for," says Charles. "We can maintain the solvency of this economy and our country, and preserve our Bill of Rights...those are very important to a lot of older Americans...but we can do that without robbing them of savings that they've given their lives to."

"We need to be sure we're protecting these (older) Americans," says Charles. "Because they have borne the brunt of this pandemic, both in terms of health and in terms of finances."

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