A 401k hardship withdrawal allows a 401k account holder to take money out of her account in order to fulfill a financial need. This process is designed to help individuals who are going through a financial hardship.

In order to qualify for a hardship withdrawal, you must not be able to get the money from some other source. You also cannot withdraw more money than you need for the financial hardship. You must also explore the possibility of a 401k loan before you can try this method of obtaining funds.

There are a few different circumstances that could allow you to get a 401k hardship withdrawal. One situation that could qualify you for a hardship withdrawal is purchasing a primary residence. Another acceptable use of these funds is to pay for college tuition. You could potentially pay for your own tuition, your spouse's or your child's tuition. 

You can also use the money to keep yourself from getting evicted from your home or to prevent foreclosure on a home that you are purchasing. You may also use the money to pay for tax-deductible medical expenses that are incurred by you or one of your dependents. 


For more information visit: Do You Qualify for a 401k Hardship Withdrawal?

blog comments powered by Disqus