05.13.20
Stay-the-Course Retirement Ethos Keeps Pandemic Panic in Check
by: Warren Rojas
While some 401(k) balances shrank by as much as 20 percent during the first weeks of the COVID crisis, retirement advisors are encouraged by the fact that most routine contributors aren’t cashing out to the extent Congress allowed in the $2 trillion stimulus law. “We’re not seeing a wave of $100,000 distributions,” Nathan Voris, senior managing director for Schwab Retirement Plan Services, said of the emergency withdrawal requests received to date from financially distressed individuals. Schwab staff said less than half of 1 percent of participants it serves have pulled out, on average, around $30,000 for virus-related relief. Prudential Retirement president Yanela Frias said her company has paid this spring. Prudential staff said the median withdrawal by the less than 1 percent of those who've asked is closer to $12,000—stressing that the majority of participants “have not had to access their retirement savings to meet near-term cash needs.”
Read the full article on Bloomberg Tax