10 Most Read 401(k) Maneuver Blogs of 2023
Years of economic hardships have sent many people online searching for helpful 401(k) articles.
A 2003 Bankrate study found that “Americans are more than two times more likely to feel financially insecure than secure. Slightly more than 1 in 4 (28 percent) Americans say they are completely financially secure. That compares with the majority (72 percent) who say they are not.”¹
Here’s the good news – you are one of the people striving to get engaged and stay engaged with your 401(k).
This makes a huge difference when it comes to feeling financially secure.
According to Empower’s second annual research study, Empowering America’s Financial Journey — How People Save, Invest and Get Advice, “People who are engaged and leverage educational content; seek out advice or guidance; and/or aggregate or consolidate accounts have higher savings rates than people who are not engaged.”²
Take some time to review our most read 401(k) articles of 2023 to gain a better understanding of your investments and feel more secure with your financial future.
#1 What Happens If I Leave My Job With a 401(k) Loan?
Millions of Americans quit their jobs over the last few years – otherwise known as The Great Resignation.
You may have very good reasons for wanting to leave your job in the coming year, but you may want to wait if you have a 401(k) loan.
With a 401(k) loan, you may have to pay off the outstanding balance in a much shorter time frame than originally planned or face penalties and taxes.
That’s why it is critical to know the rules of a 401(k) loan before you take one on.
This article explains the rules surrounding 401(k) loans and the cost of leaving a job while you have one.
Read More: What Happens If I Leave My Job with a 401(k) Loan?
#2 How to Read a 401(k) Statement and Understand It
With all the changes happening in the market and to individual 401(k) accounts, it makes sense that people sought out help reading their 401(k) statements this year.
Being able to read your 401(k) statements will give you a better idea of where you stand financially and where you are headed in the future.
It is also the best way to determine what changes you need to make to your investments to boost your 401(k) savings.
This article takes you through how to read and decipher each section of your statement.
Read More: How to Read a 401(k) Statement and Understand It
#3 Pay Off Debt or Contribute to a 401(k)
The rise in the cost of essentials has driven many Americans into debt – and it is forcing them to ask the question, “Should I pay off debt or continue to contribute to my 401(k)?”
This article carefully weighs the costs of cutting 401(k) contributions to pay off debt or continue to contribute as usual.
One piece of advice from this article is to consider whether your retirement income will even be enough to cover your monthly debts.
We conclude by suggesting how you can do both: Pay off debt and save for retirement.
Read More: Pay Off Debt or Contribute to a 401(k)
#4 New 401(k) Rules and Benefits for 2023
2023 ushered in substantial changes to 401(k) benefits, and even more changes are coming over the next few years.
In order to maximize your retirement savings, it is necessary to know about the new 401(k) rules and benefits that are a result of the Secure Act 2.0 (passed in 2022).
These changes include increased catch-up contributions, some 401(k) withdrawals without penalties, easier ways to locate old 401(k) plans left behind when you changed jobs, and more.
Stay educated to stay ahead!
Read More: New 401(k) Rules and Benefits for 2023
#5 Should I Borrow from My 401(k) to Start a Business?
One of our most read blogs every year involves determining if using a 401(k) for a purpose other than retirement is a good idea.
For example, many people consider using their 401(k) to start a business.
This article delves into the risks of starting a business, as well as the risks of using the money saved for your future.
It also carefully explains the rules, tax implications, and penalties regarding withdrawing money from your 401(k) and borrowing from your 401(k).
Read More: Should I Borrow from My 401(k) to Start a Business?
#6 What Every Investor Needs to Know about Rebalancing a 401(k)
Many people mistakenly think you set up a 401(k) and leave it alone. Wrong.
Rebalancing is essential for a healthy 401(k) account.
This is the process of buying and selling assets in your portfolio so it performs better.
If you don’t rebalance regularly, you are essentially leaving your financial future up to chance.
If you have never rebalanced your 401(k) or need more help with rebalancing, this is a must-read.
Read More: What Every Investor Needs to Know about Rebalancing a 401(k)
#7 Changing Jobs? Know Your Vesting Schedule before Quitting.
While you may have a very good reason for leaving your job in the coming year, you may want to hit the pause button and check out your vesting schedule first.
Vesting schedules prevent 401(k) investors who don’t stay long at a company from taking their employer retirement contributions with them when they change jobs.
This means that, if you decide to leave your job, you may have to pay back the money your employer contributed to your 401(k).
Rather than having your 401(k) balance take a dip, find out your vesting schedule and determine how long you need to stay before you say goodbye.
Learn the way it works in this article.
Read More: Changing Jobs? Know Your Vesting Schedule before Quitting.
#8 401(k) Hardship Withdrawals: What You Need to Know
According to Fidelity, “Participants taking hardship withdrawals from their accounts rose to 2.4% last year, up from 1.9% in 2021.”³ This represents the highest share of hardship withdrawals recorded by the financial services firm.
Vanguard also recorded a rise in hardship withdrawals in 2022. “About 2.8% of participants in its plans made hardship distributions in 2022, up from 2.1% in 2021.”⁴
Given the rise in 401(k) hardship withdrawals, we wrote an article that explains the rules surrounding this type of withdrawal so investors can understand the potential implications of taking one.
Read More: 401(k) Hardship Withdrawals: What You Need to Know
#9 Money Habits to Build Wealth
There are some money habits that millionaires embrace to build their wealth.
But you don’t have to be a millionaire to embrace smart money habits.
You can embrace these money habits no matter where you are on your financial journey and notice a change in your finances.
For example, make a point to pay yourself first. Before you pay any bills, put money into your savings and retirement accounts first.
Check out the 9 other habits of millionaires.
Read More: 10 Money Habits to Build Wealth
#10 Costly 401(k) Mistakes Investors over 50 Are Making
Those over 50 are quickly approaching retirement.
Now is the time to start making changes to how you contribute, save, and shop to put yourself on a path to a comfortable retirement.
Avoid these costly 401(k) mistakes to put yourself in a better position.
Read More: Costly 401(k) Mistakes Investors over 50 Are Making
Better Prepare for a Life of Abundance in Retirement.
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Sources:
- https://www.bankrate.com/personal-finance/financial-freedom-survey/#not-secur
- https://www.empower.com/press-center/empowering-americas-financial-journey-2022
- https://www.cbsnews.com/news/401k-hardship-withdrawals-at-record-fidelity-vanguard/
- https://www.cbsnews.com/news/401k-hardship-withdrawals-at-record-fidelity-vanguard/
